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Darwinian forces are at work in the storage industry, and users stand to benefit the most.
Last month, I explained why the storage business works the way it does. This month, I'll talk about who's benefiting from the evolutionary changes that have occurred in this space.
Revolutionary events cause rifts in the atmosphere, creating holes of new opportunity. IBM caused the great computer rift--enabling machines to perform business tasks--and it propelled them to historic levels of greatness not seen since the industrial revolution. The firm's success caused slower, evolutionary changes that enabled new holes of opportunity. Apple did it with iPod. Microsoft did it. But as IBM became more successful, the forces of evolution took hold and the problem shifted from "How do we get more leverage out of our high-priced math-whiz actuaries?" to "How will we keep all this electronic gadgetry up and running?" to "How do we do much more with way less?". Enter EMC, a fledgling memory company that saw an opportunity with a cheaper, faster, better play--namely storage. This one has even more revolutionary attributes because not only did the mighty IBM have to have woefully inferior products, but the entire market had to alter the way it bought those products. Disk was just a peripheral. Nobody ever made independent disk decisions before; it would've been like buying a car and adding your own transmission.
With evolution, EMC is now part of
Trying to convince a small slice of the market to take the hard route and be a rebel, a whole bunch of folks may have started building better mousetraps. But they suddenly find themselves relevant not because their technology is cheaper, better and faster, but because the market dynamics evolved at the right time. 3PAR has been preaching "utility" computing and delivering quality of service favoring one I/O against another for a long time. It was cool to talk about, but now it's sold hundreds of millions of dollars of gear because enabling IT to run as a legitimate sub-business with known deliverables is no longer just theory--it's the difference between IT relevance and extinction. EqualLogic didn't get 2,000 customers because people were dying to use iSCSI. It got them because it built systems that scale dynamically and because a system the size of Montana can be managed by someone as clueless as my ex-wife. Yosemite Technologies isn't selling tons of backup software because it has continuous data protection; it's winning because it took all that high-end stuff and completely hid it from the SMB guys who would rather chew tin foil than invest in something built for an enterprise. They know there are more companies with fewer than 100 folks than any other slice, and those folks care as much about their emails and accounting apps as the big banks.
Dozens of companies are building real businesses today because of luck, opportunity, and the inevitable fact that time will erode what was and expose what isn't. Firms like CommVault, Double-Take Software, Isilon Systems and Riverbed Technology have found riches in them thar hills. But even more are lurking, ready to grab their place in history--and I couldn't be happier.
This was first published in April 2007