H3C Preps Westward Move

H3C, the China-based networking vendor owned by 3Com, is heading for the U.S., armed with a variety of iSCSI SANs -- and a pitch that stresses low-cost hardware coupled with OEM'd software.

"I hope to change the impression among most customers that iSCSI is only for mid- to low-end [implementations]," says Lee Zhi, director of IP storage at H3C.

The H3C arsenal, set to be unveiled at U.S. and European trade shows this fall, includes the Neocean IX3000, a dual-controller iSCSI SAN with over 1,000 SAS/SATA II drives and a 10-Gbit/s Ethernet link. For those with more modest preferences, H3C will tote the IX1500, a 15-drive SATA/SAS iSCSI SAN with four 1-Gbit/s Ethernet links and integral VTL software from FalconStor. Both products will feature replication, mirroring, and management software, also from FalconStor.

Lee insists that most of the new wares will be available for shipment in October or November. Disk sizes will range to 750 Gbytes. H3C is testing 1-Tbyte drives and plans to offer them, perhaps in 2008. "Maybe the first or second quarter of 2008 will see the 1-Tbyte drives adopted by main dealers," he notes.

Lee also acknowledges there may be some Fibre Channel connectivity added to the new SANs, mainly to help customers interested in migrating from FC to SAS. "I think FC is a transition technology... Ten-gig Ethernet will become cheaper and cheaper... SAS is a disruptive technology in the storage area," he says.H3C's new products are based on gear it already sells in China: The forerunner of the Neocean IX1500, for instance, is the iX1000, a SATA II-based system that comes with four 1-Gbit/s Ethernet links and software from FalconStor. (See Huawei Sets Sights on IP SANs and Huawei, 3Com & H3C.) The much larger IX5000 sports up to eight controllers OEM'd from Intransa, teamed with up to 480 SATA drives packed into a Xyratex enclosure with an integral Ethernet switch. Software from FalconStor completes the picture.

Lee says the systems have taken off in China, where H3C has access to more than 2,000 distributors and resellers. More than 800 organizations have adopted the IX1000 and more than 100 the IX5000, he says. Takers include the City of ShenZhen, which has purchased over 1,400 Tbytes of storage for a video surveillance project linked to security. Another customer is Sohu.com, a Chinese Web portal which has bought more than 1,200 Tbytes of storage.

H3C claims more than a 50 percent share of China's iSCSI SAN market, Lee says, against competitors such as EMC, HP, and NetApp, which offer iSCSI as an adjunct to their Fibre Channel gear. H3C's iSCSI storage revenues nearly doubled from 2006 to this year, in which H3C hopes to post about $40 million in iSCSI revenue.

H3C parent 3Com, which has been mum on the topic of its Chinese subsidiary, did not reply to requests for comment at press time. But recent financials show quarterly GAAP revenues of $176 million for H3C in total (including SANs), up 13 percent year on year for the last quarter of the fiscal year. (See 3Com Reports 4Q.)

As noted, H3C's strategy is based on its own commodity storage hardware, which Lee insists is cheaper than hardware stateside. "In hardware design and manufacturing, China will have the advantage in cost," he says. Other components come from partnerships. Today, H3C uses chips and controllers from Intel, Intransa, and Xyratex, and software from FalconStor. More partnerships are planned.Though iVivity was a chip partner, Lee says the arrangement fell apart when some buggy chips went unfixed for several months. iVivity, contacted for this article, had this response, via email from general counsel Brian Anderson: "iVivitys technology strategic cooperation agreement with HC3 is still in effect and has not been cancelled. However, iVivity is not participating in HC3’s current storage design. HC3 decided to use alternative technology using off the shelf products for both software and hardware. iVivity’s chip met or exceeded the performance and design requirements."

H3C's strategy echoes that of H3C's former co-owner Huawei, the Chinese networking Goliath that also has undercut Western rivals with lower-cost standardized hardware.

Indeed, Huawei's recently announced joint venture with Symantec could eventually produce some competition for H3C, if Huawei decides to make its own storage gear. (See Huawei & Symantec Make It Official.)

For now, that doesn't seem imminent. And H3C's Lee is confident of his company's ability to succeed in its westward iSCSI expansion. "I hope our new system will change the traditional definition of a storage system," he says.

— Mary Jander, Site Editor, Byte and Switch