Storage sales half of what expected: report

“”Son of a gun, we just sold a SAN!””

Michel Rail, vice-president of Lachine, Que., integrator MasStor Technologies is pleased by the sale; it just doesn’t happen as often as he’d like. “”Business is good to have these days,”” he

added, “”because it has slowed down.””

A recent Evans Research Corp. study suggests that Rail isn’t alone in his appraisal. The storage market hasn’t taken off nearly as quickly as earlier research indicated.

Network attached storage (NAS) and storage area network (SAN) revenues grew by approximately 50 per cent over a period spanning 2000 and 2001, but earlier predictions had put that number closer to 100 per cent, said Jennifer Ewen, who authored the Storage End User Study.

“”Storage is dependent on the growth of data, so it’s not going to go away. It’s just not as robust as expected. There was perhaps some ‘irrational exuberance,'”” said Ewan, paraphrasing Federal Reserve chairman Alan Greenspan’s comment on stock market speculation.

Surprising to Ewan was the relative strength of SAN over NAS, which is the more expensive option. But she said data collection may have skewed the results, since half of the study’s 300 participants were from enterprise-sized companies.

Rail said a lack of customer awareness is partly to blame for the reduced growth. “”I had a customer two weeks ago who thought NAS was the French term for SAN. People need to be educated about it,”” he said.

Customers ask for a SAN solution without knowing the costs involved, then balk when faced with an estimate for $6,000 per server. “”A lot of companies don’t need a SAN,”” he said. “”You are going to spend an outrageous amount of money to put together a SAN which you probably don’t need.

“”I’ve seen a lot of request for proposals (RFPs) from customers where they’ve done the analysis and it’s lacking so much of the important details to properly put together a SAN or a NAS,”” he said. Rail likened the situation to going to a doctor’s office and asking for a diagnosis without telling him your symptoms or allowing him to examine you.

He said he recently dealt with a school board in the market for a storage solution. The board did its own needs analysis but lacked the relevant knowledge to put a comprehensive proposal together. “”We did not bid on that RFP and we sent a letter to them explaining why. . . . They came back to us and said, ‘Would you help us put together a proper request for proposal?'”” MasStor did create an RFP for the school board, but effectively put themselves out of the running in the process.

Ewen’s report also looked at the role of data recovery services in the storage market. “”People become much more religious about backup when they’ve actually experienced a loss. There’s no substitution for first hand experience as a sales tool for storage vendors,”” she said.

According to the study, half of respondents experienced data loss, but only 42 per cent of them used a data recovery service. That number may indicate that that the other 58 per cent were able to handle the recovery in-house, said Ewen.

It’s possible, however, that some data loss victims rely on hard copy backups or simply sacrifice the data in favour of paying for a recovery service, said Ron Austin.

Austin, vice-president of business for development for Toronto-based Actionfront Data Recovery Labs, added that it’s also possible they don’t even know such a service exists. (Actionfront commissioned the data loss portion of Ewen’s study.)

Austin counts among his chief clients financial companies, healthcare providers and government departments — industries that require 100 per cent of their data for ethical, legal or emergency reasons.

The data recovery business is growing, said Austin, but he doesn’t see a lot of repeat business. “”Most data loss victims, it happens to them once, then they’re a lot more careful in the future about backing up. You really can’t do a lot of marketing to your customer base.””

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