EMC's New Look: Small N' Cheap

EMC Corp. (NYSE: EMC) today announced an upgraded line of its Symmetrix storage arrays. But it could represent a double-edged sword for the storage behemoth.

On the one hand, the products pack more capacity, network capabilities, and performance into smaller chassis (all of which is "pretty sweet," as Cartman would say).

Additionally, the products are a lot cheaper than EMC's existing offerings, giving it a way to play in the mid-tier bracket of the market, against Compaq Computer Corp. (NYSE: CPQ), Dell Computer Corp. (Nasdaq: DELL), MTI Technology (Nasdaq: MTIC) and others, where analysts say it could do some damage.

"Users believe that EMC has the highest-end stuff, but only those 'elite' users have been willing to pay for itthis box is an effort to get a whole new audience to hop into this class of product," says Steve Duplessie, senior analyst at Enterprise Storage Group Inc..

Duplessie reckons, however, that EMC could also damage itself in the process (the other edge of the sword), by cannibalizing its own revenues from its existing Clariion mid-tier product range. "EMC appears willing to do this in order to steal shares from the others," he says.There are three models in EMC's upgraded Symmetrix line of storage arrays: the 8230, 8530, and 8830. The devices feature a better capacity-to-size ratio than EMC's previous offerings and have been outfitted with a new device, called a Global Cache Director -- essentially, a local cache that should boost performance.

Also new are the networking capabilities. The 8230 can be outfitted with an integral 4-port Fibre Channel switch; the 8530 and 8830 can be equipped with either 4- or 12-port FC switches. This could have nasty repercussions for Brocade Communications Systems Inc. (Nasdaq: BRCD)and McData Corp. (Nasdaq: MCDT) whose raison d'être is Fibre Channel switches.

So which one of the new EMC products is the most significant? "The headline is…they are all important," says Chuck Hollis, vice president of markets and products at EMC.

Actually, Chuck, that definitely isn’t the headline.

— Jo Maitland, Senior Editor, Byte and Switch http://www.byteandswitch.com