MTI Is Back

With new caching and backup technology, MTI is set for a revival. What are its chances?

November 7, 2001

3 Min Read
Network Computing logo

MTI Technology Corp. (Nasdaq: MTIC) has been in business nearly as long as there's been storage (well, since 1987 anyway). And it looks as though the maker of high-end storage arrays may be turning another page in its history.

With a new caching appliance and a hardware-based replication product, MTI is finally emerging from a long period of stagnation following the loss of its dotcom business (see MTI Technology).

The positive signs are visible in the companys gently climbing stock price, up from $0.68 a month ago to $2.25 at the close of market Tuesday. MTI officials say it's a sign of better times ahead. “We are a good indicator of what’s about to happen in the market,” says Russ Ritchie, director of product marketing at MTI. “Our revenues go down before everyone else’s, and up before everyone else’s.”

MTI reported a 10 percent revenue increase for its fiscal second quarter, ended October 6, compared to its first quarter. It still lost $2.7 million, or $0.08 per share, compared to a net loss of $2.1 million, or $0.07 per share, for the same quarter a year ago. But there are signs of improvement. Its operating loss decreased dramatically to $3.4 million, a 67.6 percent sequential improvement.

New products and a steadily growing professional services organization (75 people in the U.S., 25 in Europe, or twice the number from a year ago) are driving these improvements in performance, Ritchie says.The DataSentry 2.0 hardware-based data replication product, announced today, is embedded in MTI’s Vivant storage array and allows multiple copies of data to be produced simultaneously on a local or remote basis. The replication server supports Fibre Channel-to-IP encapsulation using the emerging FCIP (Fibre Channel over IP) specs for long distance backups. The server will be generally available December 1, 2001. By mid-2002 it will support native iSCSI, Ritchie said (see MTI Upgrades Its Software).

But the hottest piece of technology over at MTI could be its v-cache appliance. This ships as a standalone device or inside MTI's Vivant V-80, adding four-way scaleability (four extra processors) to this storage array. It also sports a 100-gigabyte caching option.

According to Ritchie, as few as 5 percent of the files in a database application like Oracle Corp.'s (Nasdaq: ORCL) account for 80 percent of the I/O (input/output) resources on the array. If these files can be migrated into a cache, this frees up the burden on the storage system.

A typical caching appliance can perform around 6,000 to 10,000 I/Os per second, whereas a disk array handles far less, around 120 I/Os per second, Ritchie says.

MTI’s technology is similar to caching appliances from Network Appliance Inc. (Nasdaq: NTAP), Cisco Systems Inc. (Nasdaq: CSCO), and Extreme Networks Inc. (Nasdaq: EXTR), all of which speed up Web content serving, although the implementations vary.Network Appliance's box is ideally deployed at a colocation center, where it sits next to a Web server, caching the most frequently used pages in order to get content to users faster. MTI’s v-cache is ideally deployed with the storage on a SAN, to speed application availability, Ritchie says. Initial customer acceptance has been promising, with eight v-caches shipped in September.

In response to market demand for storage virtualization, MTI has also formed a strategic development and OEM agreement with FalconStor Software Inc. (Nasdaq: FALC) to incorporate its storage virtualization technology in MTI's Vivant SAN and NAS storage arrays. Stay tuned for more details on this.

With these two key products and its virtualization deal with FalconStor, MTI is hoping to convert some customers from its competitors -- which include EMC Corp. (NYSE: EMC), IBM Corp. (NYSE: IBM), Hitachi Data Systems, and Compaq Computer Corp. (NYSE: CPQ).

Analysts say just getting in the way of these competitors will yield sufficient business to keep MTI in shape. “If it achieves this, that’s plenty of business,” says Dan Tanner, analyst with Aberdeen Group.

— Jo Maitland, Senior Editor, Byte and Switch

Stay informed! Sign up to get expert advice and insight delivered direct to your inbox
More Insights