First, let me apologize. I realize that any discussion about anything to do with tape is about as exciting as a six-hour bus trip to a prostate exam. This isn't really about tape, as much as it is about business - and things you might want to think about when you're making your high-end SDLT vs. LTO decision.
My contention is that due to business factors, within a few short years LTO will most likely cease to exist.
In the high-end of what some call the midmarket for tape (sorry, blame Gartner for that one) sit two competing technologies - SDLT and LTO. Quantum makes SDLT - and DLT, which is relevant, I swear. LTO is a consortium effort, which means more than one person makes the stuff, in this case Seagate, IBM, and HP. LTO and SDLT are both good. Today LTO has about 60% of that market slice vs. SDLT's 40%. So what's the issue? First, if all things are about equal, people want compatibility - preferably backwards and forwards.
There are a billion DLTs out there. Now that Quantum bought Benchmark, they have a DLT family that runs from the low value (read: Dell) end of the spectrum, to the high midmarket with SDLT. Their roadmap shows them moving up and down. I don't think you'll ever see LTO move down.
Second, people don't give a rat's bottom about LTO or DLT. Tape is bought (in this market) from the OEM's. The brand is the OEM, not the manufacturer. IBM customers buy IBM tape stuff. They don't care what the components are comprised of. HP, Sun, Compaq, EMC, and STK are the same way. They offer what the customer wants, which is typically whatever the sales guy told them to buy. Many are the same guys who make LTO - yet they also sell truckloads of SDLT. This is the business end of the equation.
If something isn't entirely strategic, a company has to make a make vs. buy decision. If I'm HP, and I know I can generate the same revenue, gross profit and margin dollars whether I invest in making stuff vs. buying stuff, packaging it and selling it without any R&D expenses, why would I continue to build my own stuff? The same is true for IBM. HP just made the decision to stop building its own tape automation (library) products, and instead buys from Quantum/ATL - for the aforementioned reasons - so why keep making tape? IBM just got out of the hard drive business. Sooner or later, both those guys will figure out there's no strategic benefit to staying in this game. Seagate wants to go public again. To do so, it will shed its tape business. You see where I'm going with this?
The only way I see LTO continuing is if all the companies decide to spin out their efforts into a standalone entity, but hey, these are computer guys and the odds of them agreeing on anything is about as probable as the Patriots winning the Super Bowl again. Could happen - but do you want to make that bet? FYI, I don't own any Quantum stock. If I did, it would surely plummet.