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External Disk Storage Market Continues To Boom, Revenue Up 9.9%

EMC paced the external disk storage market in revenue gains, growing from $786 million in 2005 to $927 million this year, and in market share, rising from 20% in 2005

Profiting from the trend was EMC, which capitalized on server virtualization, which is spurring the move toward more powerful and expensive systems. "Folks are going from tens and even thousands of servers to fewer systems," Nisbet says. "And that means they follow on by consolidating on the storage side."

Nisbet points to EMC's VMware unit as a strong driver of server virtualization. "VMware is one of the hottest things on the planet right now," he says. VMware's technology enables virtualization, which encourages consolidation of servers, which in turn encourages consolidation of storage into larger external disk systems.

Other drivers of large external disk systems are customers' consolidation of branch offices and the trend of organizations to store vast amounts of fixed content.

The IDC report ranked IBM third with a market share of 13.7%, up from 13.1% in the previous year, and revenue of $591 million, up from $517 million. Dell and Hitachi rounded out the top five. Dell recorded $347 million in revenue for an 8% market share, while Hitachi logged $340 million for a 7.9% share of market.

While IDC's Friday report focused largely on the storage segment of most interest to IT managers—external disk storage systems—the market research firm broke down the total all-inclusive disk storage systems market into different categories. In the total market, HP leads with a 22.7% market share representing $1.4 billion in revenue, while IBM is in the second position with a 20.2% share and $1.25 billion in revenue. EMC's $927 million external disk storage segment was enough to place the firm in third place in the total market.

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