The Hottest Storage Networking Market Segments

As world markets go, storage networking is a winner. Financial pundits say the sector has so far escaped the worst of the ongoing macroeconomic hurricane. And it looks like a handful of storage sub-segments are actually thriving.

In a few key areas, in fact, the prospects for storage equipment and software have never been better. These are the segments where sales are hottest, startups are getting top funding, and user demand is clear and strong.

Here are six of our top candidates for hottest storage segment, culled from contacts with vendors, analysts, and customers in the trenches. Please note: These are segments we see as hot right now. There are storage networking segments in development that haven't quite started to materialize:

No. 6: Medical archiving. Hospitals, doctors, and health care facilities worldwide are building ever-greater volumes of images related to their Picture Archiving and Communications Systems (PACS). No sensible storage vendor is without a solution, including EMC, HDS, HP, IBM, NetApp, Overland, Permabit, and Plasmon. Medical content management specialist Bycast has partnered with a range of suppliers successfully. And services are emerging, most recently from Iron Mountain. Expect much more.

No. 5: Government storage. The reason that Arkeia, Asigra, InMage, and other suppliers have assigned specific resources to the government sector is that it's worth it. Government continues to be a significant investor in storage IT, and reports highlighting trends toward infrastructure optimization (read: virtualization and iSCSI), content security, and Web 2.0 networking show there will be plenty of need for government storage in the foreseeable future.No. 4: Hosted applications. According to In-Stat, hosted applications are driving the managed services bus, which will bring in $42.2 billion in domestic revenue this year. Those hosters need storage, which is why suppliers like Asigra are courting them. At the same time, cloud computing efforts by EMC and IBM signal that storage vendors are eager to build an infrastructure for software as as service (SaaS). This is a hot one for sure.

No. 3: Social networking. Wikis, blogs, and sites like Facebook need tons of storage. And that trend will only continue, as corporate applications start to adopt the Web 2.0 models used in social sites. While this area is hot today, its effects on storage will be significant over time. Users predict that the requirements of social networking will drive enhancements of the management of fixed unstructured content and files. We are already seeing evidence of this with EMC's reported work on Maui. More will come.

No. 2: Entertainment. Increased use of video in all kinds of broadcasting, along with a revolution in digital processing for movies has storage companies racing to keep pace with this particular vertical.

No. 1: Video surveillance. According to ABI Research, the market for video surveillance will balloon in the next couple of years, reaching a whopping $46 billion by 2013 -- more than double 2006's revenue level of $13.5 billion. While storage will comprise just part of that, the opportunity is already being mined by suppliers such as Intransa and Pivot3, which offer solutions for the management and storage of data for a range of video surveillance applications. Since the world is only getting more paranoid, it's not likely this segment will slow down any in the near term.

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