Can SGI Expand Its Turf?

Silicon Graphics Inc. (SGI) (NYSE: SGI) has quaffed a stiff shot of marketing schnapps.

Thus fortified, the high-end Unix server specialist is trying to reposition itself as a major storage player, with plans to more assertively market and sell its SAN offerings outside the high-end computing shops that are the company's traditional customer base. As part of the push, SGI has established a single brand -- InfiniteStorage -- for its various storage hardware and software. [Ed. note: Which beats its first idea, L'il-Bit-o-Storage.]

In addition, it has signed an OEM deal with SAN management software startup AppIQ Corp. The deal is the first such licensing arrangement for AppIQ, which was founded in July 2001.

"The intent is to take these InfiniteStorage products and take them out a little more aggressively into the mainstream market," says Ajay Anand, director of storage marketing at SGI.

Right. But the problem is, today SGI's foothold in the storage market is quite finite. Today, nearly all of SGI's storage products are sold in conjunction with its servers, and mainly into vertical industry segments like scientific computing and oil and gas exploration.The company is not even close to being in the same league as heavy-hitters like EMC Corp. (NYSE: EMC), Hewlett-Packard Co. (NYSE: HPQ), and IBM Corp. (NYSE: IBM). And SGI does not develop any of its own storage systems; rather, it resells LSI Logic Storage Systems Inc.'s RAID arrays.

Can the Unix player convince a broader market that it provides a complete bushel of SAN technologies?

The software it's picking up from AppIQ gives SGI a decent start, anyway, giving SGI customers the ability to manage multivendor storage environments. As part of the companies' agreement, SGI will OEM components of AppIQ's SAN management technology and will also resell AppIQ's software suite.

Also this week, SGI is rolling out a new version of its CXFS shared file system, which lets users share data concurrently over a SAN without replicating files. Version 3.0 adds support for Linux and IBM AIX, in addition to previous versions' support for Irix, Solaris, and Windows.

We're still not sure whether SGI's amalgamation of storage-related software and hardware -- some of which it develops itself, and some of which it obtains from third parties -- deserves an appellation as grandiose as "InfiniteStorage." SGI's storage lineup is clearly not as deep as those of EMC, HP, IBM, or even Sun Microsystems Inc. (Nasdaq: SUNW). But hey, you gotta start somewhere.Todd Spangler, US Editor, Byte and Switch