Storage market plods on despite crunch

MUMBAI, INDIA: The emerging storage technologies market in South Asia and the Middle East seems relatively insulated from the current economic slowdown, as a boom in data growth as well as enterprises' need for business continuity, disaster recovery solutions, and regulatory compliance have caused a spurt in the technology's adoption levels.

This was found out  by new analysis from Frost & Sullivan in its latest report, 'Emerging Storage Technologies and Adoption in South Asia and Middle East'. It further finds that market in India, Saudi Arabia, the United Arab Emirates, Egypt, and Sri Lanka earned revenues of $653.4 million in 2008 and estimates this to reach $2146.4 million in 2015. This growth is driven by increased data, computing and business continuity requirements of enterprises.

Businesses are increasingly focusing on gaining an edge by reducing operational risks and there have been substantial advances in data storage to supply the demand for better data management and recovery.

Enterprises are either investing in in-house storage solutions or are outsourcing their data backup needs, as

they are looking to improve their ability to recover from any disaster at the earliest to ascertain business continuity.

Frost & Sullivan Industry Analyst Saumya Upadhyaya, said: "Network storage helps data centers achieve consolidation, resulting in better utilization, optimization of resources, and lowered total cost of ownership (TCO). Enterprises can also utilize their resources better due to the shared network space between applications."

Within network storage, storage area network (SAN) is the most popular for its performance benefits, especially in mission critical applications.

Network attached storage (NAS) is the solution of choice among customers with specific file-serving requirements.

Despite their significant benefits, storage solutions has lost some traction in the first half of 2009, compared to the previous years, due to cautious IT spending in the current straitened circumstances. In addition, the rapid adoption of storage technologies in the last few years is likely to create a lull in the market. The use of virtualization solutions to increase utilization of existing storage devices is also a threat to the growth of storage hardware market.

Market participants also have to battle customer perceptions about the complexity and high initial costs of

migrating and managing a networked solution.

However, storage solution vendors are hopeful that the market will take a turn for the better by 2010, with costs lowering and small- and medium-sized enterprises (SMEs) latching onto the opportunity to equip

themselves with storage solutions. Although direct attached storage (DAS) solutions are expected to compete head-on against storage solutions in the SME sector due to their low initial costs, network storage provides better returns in the long term.

Vendors have been training their channel partners to step up customer education efforts among the stakeholders - both partners and end consumers - and make them aware of the technological and financial benefits of their solutions. They have also been introducing entry-level network storage devices to cater to the burgeoning entry- and mid-segment markets. These strategies seem to have paid off, with several new end users investing in network storage solutions.

"Apart from the traditional high IT spenders such as telecom, banking, financial services, and insurance (BFSI), and IT/IT-enabled services (ITeS), increasing data needs in sectors such as healthcare and media are

showing robust growth potential," notes Upadhyaya. "In addition, increasing IT adoption initiatives by sectors such as government, retail, and infrastructure are driving demand."