StorageTek Slings SL500

Company goes for maximum tape cartridge capacity in a small rack; analysts hope it will revive sales

June 30, 2004

3 Min Read
Network Computing logo

Storage Technology Corp. (StorageTek) (NYSE: STK) today moved to restore its position in midrange storage systems by announcing another member of its StreamLine tape library family.

The SL500 is built on the same technology as the high-end StreamLine8500 library, but it's a smaller, dense, modular system that fits 90 tape cartridge slots per square foot.

The SL500's modular design holds from 30 to 577 cartridges, depending on the configuration. The library consists of a base module that contains the robotics and 30 to 50 cartridge slots. It allows customers to add up to four expansion bays that include 90 to 130 slots apiece. The strategy is to compete with Advanced Digital Information Corp. (Nasdaq: ADIC), Overland Storage Inc. (Nasdaq: OVRL), and Quantum Corp.

The announcement of the SL500 has been eagerly anticipated. It follows the StreamLine8500, which StorageTek announced last October and started shipping this quarter. The lag time didn't hurt StorageTek much in the higher-end market, where its main competitor is only IBM. But in the midrange market, where it has more competition, many observers say the market's been waiting for the product.

At least one storage analyst thinks the SL500 is well positioned to boost StorageTek's prospects in that market."What's nice about it is it's small," says Dianne McAdam, senior analyst at Data Mobility Group. "[StorageTek is] aggressively going after the SMBs because that's where the market growth is. Customers are looking for a small footprint."

Analysts say the company's tape library sales have been soft this quarter, and at least part of the reason is because customers have been putting off replacement systems, waiting for the SL500.

"The product will be out in the fall, so customers are saying 'Hey, I can wait three months for my new tape library,'" says analyst Kaushik Roy of Susquehanna Financial Group. "Now we will see if they can regain some of that mindshare in the midrange."

StorageTek officials said they opted for a design that provided the maximum number of tapes in the smallest space, after talking to hundreds of customers for design input. This may have been the cause of some of the delay.

"In the past, only small libraries fit into racks," says Jon Benson, StorageTek's VP of automated tape solutions. "Customers wanted a big library in a small rack."StorageTek hasn't set pricing on the SL500. At the same time, the company also announced:

Dave Raffo, Senior Editor, Byte and Switch

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

You May Also Like

More Insights