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HP closes on EMC in storage race

HP closes on EMC in storage race

Number two storage systems maker Hewlett-Packard has closed the gap

between it and number one EMC to what research company IDC calls "a

statistical tie."

But EMC argues its lead over HP is greater if co-branded Dell-EMC storage

devices are counted as EMC sales instead of as Dell Inc. sales.

According to IDC's Worldwide Quarterly Disk Storage Tracker, EMC held an

industry-leading 20 percent market share for external disk storage systems in

the second quarter of 2006, followed by HP with a 19.3 percent share. EMC had a

21 percent share to HP's 18.9 percent in the second quarter of 2005.

In the latest results, IBM earned third place with a 13.2 percent share,

while Hitachi Data Systems, Dell and Sun Microsystems recorded

market share of between 7 percent and 8 percent, which IDC labeled a three-way

tie.

IDC considers companies to be tied for market share if the difference between

them is less than 1 percentage point, said Brad Nisbet, program manager for IDC

Storage Systems.

The second quarter figures show a tight race between EMC and HP, but EMC

spokesman Greg Eden said EMC is further ahead than those numbers suggest. The

market share numbers don't count storage devices that EMC manufactures for

Dell. They are co-branded as Dell/EMC storage but counted as Dell sales

revenue, he said.

If Dell/EMC sales were counted as EMC revenue, the company's second quarter

market share would be 26.1 percent, Eden said. IDC confirmed that number.

However, EMC stumbled in the second quarter when inventory problems prevented

it from fulfilling orders for some of its Symmetrix DMX3 high-end and Clariion

CX3 midrange storage models.

"We had double-digit growth in our bookings for our storage," Eden said, but

customers wanted the newer models and were not content to buy the older ones.

Manufacturers with the strongest second-quarter percentage growth from a year

earlier were Sun Microsystems (19.1 percent), Hitachi (17 percent) and HP

(10.3 percent.).

"HP has been executing well under new management," Nisbet said, referring to

President and Chief Executive Officer Mark Hurd, who replaced Carly Fiorina in

March 2005. HP's storage revenue grew by 22 percent in Western Europe in the

quarter, he said.

Sun reported the strongest quarterly jump due in part to its acquisition of

storage vendor StorageTek in 2005 and the development of the first StorageTek

disk storage products, Nisbet said, while Hitachi recorded strong sales of its

high-end storage products.

IDC said the second quarter, which ended June 30, was the 13th consecutive

quarter of revenue growth for the external disk storage sector. Revenue rose

8.5 percent to US$4.2 billion, from $3.8 billion a year earlier. Storage demand

is growing as enterprises generate more data they have to manage and archive,

he said.

"Storage continues to be an integral component of a full (IT) solution," Nisbet

said.


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