Disk backup is on the upswing at the expense of tape, according to evidence from tape vendors.
Overland Storage Inc. (Nasdaq: OVRL) today provided the most dramatic proof that the tide is turning toward disk (see Overland Reports Q2). Overland says revenue of its disk-based systems (named the REO line) doubled from last quarter to $2.8 million, and units sold grew 77 percent sequentially to 395, while tape revenue was flat sequentially and down 10 percent from last year, falling from $66.4 million to $59.7 million.
Storage Technology Corp. (StorageTek) (NYSE: STK) last week also reported its disk product revenue grew while tape revenue shrank sequentially and year over year (see StorageTek Serves Up Services). Advanced Digital Information Corp. (Nasdaq: ADIC) and Quantum Corp. (NYSE: DSS) didnt break out disk numbers in their most recent earnings reports, but both also heavily push disk-backup products.
Overland has been the boldest of the tape guys about openly embracing disk and the software that enables disk-based backup. In its earnings call with analysts today, CEO Christopher Calisi called disk-to-disk backup the top priority for IT departments. Calisi expects the move to disk backup to continue in the current quarter, and he forecasts disk revenue of $5 million.
The tape vendors walk a tightrope with disk, which remains a tiny part of their revenue. If disk becomes the backup medium of choice, customers may forsake tape vendors in favor of disk-only players such as EMC Corp. (NYSE: EMC) and Network Appliance Inc. (Nasdaq: NTAP), or virtual tape players such as Alacritus Software Inc., Diligent Technologies Corp., and Sepaton Inc.
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