Data storage market falls 3% in Q3

SAN FRANCISCO: Revenue in the worldwide disk storage market fell 3 percent in the third quarter to $4.7 billion from the second quarter, indicating that no rebound in the flagging industry is within sight, a research group said on Friday.

"The failure to gain revenue momentum in (the third quarter) is yet another indication that a rebound in the disk storage systems market is not imminent," said Charlotte Rancourt, an analyst at market researcher International Data Corp., in a statement.

Rancourt said that third-quarter revenue in the industry was consistent with the trend of the number of gigabytes per device growing while the price for each gigabyte of storage continues to fall faster.

Overall, IDC said that Hewlett-Packard Co. retains its total storage revenue leadership with 27 percent market share, followed by International Business Machines Corp. with 20 percent market share. Hitachi and IBM had the strongest sequential quarterly growth, of 23 percent and 7 percent, respectively.

The network-attached storage market saw the biggest revenue decline in the overall market, as sales fell 10 percent in the third quarter from the second quarter, IDC said. Revenue in the storage area network market fell 6 percent sequentially.

Demand for data storage has soared as companies have moved their businesses online and increased their use of software databases and networks to store and route information. But tight technology budgets and quickly declining prices of hard disk drives have left storage vendors pressed during the current downturn.

Networked storage continued to grow, IDC said. The hottest sector within storage is for systems that network storage into pools to smooth management and make it easier for data to flow around a corporate computer network.

Network Appliance Inc. took the lead in the network-attached storage, or NAS market, IDC said, with 38 percent of that market, while EMC Corp., dropped to the No. 2 position in the third quarter with 31 percent share.

In the storage-area network, or SAN, market, HP edged out EMC for the No. 1 position with a 31 percent share. EMC trailed with 27 percent market share, IDC said. EMC kept its lead in the total network storage market (NAS combined with SAN) with 28 percent share of revenue in those two markets, IDC said.

IDC said the total external storage market, which is networked storage plus direct-attached storage, fell 5 percent to $3.2 billion in the third quarter from the previous quarter. HP retained its leadership with a 22 percent share of revenue in the total external storage market, followed by EMC and IBM with 15.8 percent and 14.6 percent, respectively.

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