IP SAN Serves Two Masters

The entry of big Fibre Channel SAN players into the IP SAN fray is both a threat and a promise to those smaller companies who have made iSCSI their battle cry (see EMC to Serve Up IP SANs). And the conflict over who's right could put users in a quandary.

The arrival of EMC Corp. (NYSE: EMC) and Dell Inc. (Nasdaq: DELL), which will co-brand EMC's AX100i IP SAN, as well as IBM's entry into iSCSI last year, puts some of the biggest Fibre Channel SANs players into the IP arena, and others are sure to follow (see IBM Slips iSCSI Into SAN).

That's good news for a growing market. According to IDC, the iSCSI market rose from $19 million in 2003 to $85 million in 2004. IDCs forecast for this year is $296 million. “We’ve got about three years of a big rising tide,” IDC analyst Robert Gray says of the IP SAN market.

Among the companies riding the crest of the tide is Network Appliance Inc. (Nasdaq: NTAP), which has gained 43.1 percent of the market, according to IDC. A handful of startups also have done well (see NetApp Banks on iSCSI). EqualLogic Inc., LeftHand Networks Inc., Intransa Inc., Sanrad Inc., and StoneFly Networks Inc. all claim hundreds of customers.

But while NetApp is used to battling EMC on the NAS front and is strong enough to survive the challenge, the startups see EMC’s entry in IP SANs as a double-edged sword. On one hand, it legitimizes iSCSI. On the other, it threatens their survival.