Storage Sales Soar Entering '04

The sharp market growth storage executives are forecasting for this year apparently started at the end of last year.

Storage revenues jumped solidly during the fourth quarter and were up overall for 2003, according to two research firms. IDC

says the external storage market grew by 8.4 percent year-over-year to $3.7 billion in the fourth quarter. For the year, IDC says, sales crept up 2 percent to $13.2 billion despite a slow start. Gartner/Dataquest
says the total storage revenue for the year was up 6 percent to $12.89 billion for 2003.

"The U.S. was the first to feel the downturn and is now leading in the recovery with a healthy 7 percent growth rate," says John McArthur, group VP of storage research at IDC.

Industry experts expect the growth to continue throughout the year. During the recent round of earnings reports, most storage executives said they expect solid growth in 2004 -- although some were a bit cautious (see Storage Bigs Brash on Budgets and HP Leery of Uptick Talk). The IDC and Gartner numbers show the revenue spike got a running headstart start during the end of 2003.

The fourth-quarter winners:

• EMC Corp. (NYSE: EMC)
  was the leader, according to Gartner, with 20.6 percent of the total external controller-based market for the year. According to IDC, EMC passed Network Appliance Inc. (Nasdaq: NTAP)
  as the NAS market leader with 37.8 percent of the market, compared to 33.3 percent for NetApp in the fourth quarter. It was the first quarter that EMC beat out NetApp in NAS revenues since the second quarter of 2002.
• Hewlett-Packard Co. (NYSE: HPQ)
  was the worldwide leader in external storage systems for the fourth quarter and the year, according to IDC, edging EMC in both periods. HP was the leader in the open SAN market with 30.9 percent of the market for the quarter, and it showed a 49 percent sequential NAS growth. Gartner shows HP as second to EMC overall with 18.6 percent of the combined NAS-SAN market.
• Dell Computer Corp. (Nasdaq: DELL) continued its meteoric growth by expanding its revenue by 50 percent for the year and 48 percent for the fourth quarter and increasing its yearly revenue by 44 percent, according to Gartner. Dell was the biggest gainer percentage-wise, according to both research firms, passing laggard Sun to move into fifth for external storage sales in the fourth quarter, according to IDC. Dells storage sales have received a big boost from its co-branding arrangement with EMC to sell Clariion midrange SAN systems (see Dell's Storage Sales Jump and EMC Lets Clariion Out of the Bag.

Of course, not everybody joined the party: