In June of 1999, IBM made the bold prediction that its new high-end data storage system was its ticket to the top...
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spot in the enterprise storage arena. A year later, IBM continues to forge ahead with those plans, earmarking an additional $400 million for storage initiatives, including a number of "solution centers" which opened up last week in cities nationwide.
IBM's high-end data storage product, dubbed Shark, can connect to a multitude of servers, including the AS/400. According to IBM, Shark has helped to penetrate 40 percent of EMC's storage accounts. Although EMC says IBM's figures are exaggerated, analysts say it's clear, IBM is becoming a powerhouse in the enterprise storage market.SearchStorage.com news editor, Kate Evans-Correia talked with IBM's Mike Harrison, director of marketing for the company's disk storage systems group, about IBM's future enterprise storage initiatives, how Shark fits into that strategy and if he thinks it can continue to steal market share away from EMC.
SEARCHSTORAGE.COM: After a year on the market, it's clear that Shark has been the product to open the door to the enterprise storage market for IBM. Does Shark continue to be the powerhouse product IBM claims it to be and if so, how does it play out in IBM's storage initiatives?
HARRISON: Shark is a very integral piece of IBM's storage strategy. I'd call it a lynchpin, but not in regard to capacity placement or satisfying demand. Rather, Shark is setting the pace for a whole new approach to storage--one that is very network centric and characterized by consolidation and by the need to have the capability to address explosive growth without a corresponding increase in expense budgets associated with storage.
SEARCHSTORAGE.COM: How does Shark do that?
HARRISON: There's two main areas that allow us to address that--extensibility and scalability. Users need to have the ability to store data on systems that can grow. That doesn't mean how big it is. It means how much can it store and still deliver performance. We built it so it could grow without impacting online time.
The other side is the management of this system. Customers don't want to add staff every time they add capacity. According to figures from a variety of sources, for every $1 spent on storage, $7 is spent to manage that storage. What we've done, apart from the hardware, is to design a system that has an interface that allows for more storage to be managed by fewer people. So, we can grow it without disrupting business.
SEARCHSTORAGE.COM: Analysts say IBM is back in the storage business. Did IBM ever leave? Or, does it just mean that Shark makes you a very serious contender?
HARRISON: They mean the latter. IBM never left the storage business. However, if you look at the product portfolios over the past eight years, there have been areas of concern. Our product line didn't address the needs of high performance applications. Shark does that. It's been a long time since IBM has been able to say it has the best storage solution in the industry.
SEARCHSTORAGE.COM:You've made it clear that you're going after EMC's business. But, you're competing in a rapidly growing, and fiercely competitive, industry. It seems another company is jumping into the market all the time. How will you position yourself against your other competitors?
HARRISON: You're right, EMC is one of our top competitors. However, the storage opportunity is so huge that it has attracted competitors at an amazing rate over the years. These competitors have come in with some very good offerings. It used to be that customers looked at whoever supplied their server to provide their storage. If you bought a Sun server you bought Sun storage. If you bought a Hewlett-Packard server you bought Hewlett-Packard storage. Now, users are saying, 'I have other things in my shops. Does it make sense to have one for each when I can get one company that supports them all?'
Customers are looking for economies of sale. What we're doing is addressing the needs of customers who want the option not to be locked into one vendor. We've adopted an open network approach to this. We are not IBM-centric, in terms of the products that we put out. Shark will work with a multitude of products. Not just IBM products. We have spent a great deal of time in trying to understand a customer's overall requirements so we could map our systems to their needs. That's what our development efforts have focused on.
SEARCHSTORAGE.COM: Who is your target audience?
HARRISON: Basically, anyone in the storage arena who is looking for an enterprise-class storage solution.
SEARCHSTORAGE.COM: What part has the Web played in your decision to aggressively market storage products?
HARRISON: Very, very big part. The vast majority of the growth we see is driven by the Web. Whether or not it's from a service provider standpoint or from the brick and mortar companies that want to take advantage of the Web so they can compete, there is a set of requirements that are Web-driven that are the base of all our system development. We used to talk about continuous availability but still be able to go down during slow hoursat night or on holiday weekends for upgrades or maintenance. Now it's 24x7, because they don't know what time of day their business will be driven. Availability requirements have been driven to new heights. Customers need products that can support that.
SEARCHSTORAGE.COM: With so many vendors, major companies, like Compaq and now EDS, entering the storage market, will there be an eventual shakeout? If so, where will IBM end up?
HARRISON: IDC predicts this phenomenal growth rate-something like 70 percent of IT dollars will be spent on storage in the near future. Everybody wants to be a player. Will there be consolidation? Yes. But the companies that will survive are those that have investment capability to support and maintain levels of development. It's easy to come up with a new product and bring it to market. However, it takes commitment, resources and development research to maintain a position in the market. In March, we announced our continuing investment in storage-including our $400 million investment in storage initiatives. That's the kind of continued investment that it's going to take to survive and be a long-term player. IBM recognizes the opportunity and the resources and we are pursing that opportunity. We're investing for the long-term.
SEARCHSTORAGE.COM:EMC has said that IBM's claims that it has taken as much as 40 percent of EMC's market base is grossly inflated. They also say that for every one customer you have, they have 10-in essence, saying IBM has a long way to go in catching up to them. EMC does have a huge installed base. How will you go after that base?
HARRISON: Directly. Our success rate is growing in getting EMC accounts. EMC has the installed base it does because for a long time, EMC was the only choice of customers. There are things that happen when you start to be a player that can address certain needs. Customers are clearly looking for a choice. I spend a lot of time talking to customers and I have never seen the kind of support that I've seen with Shark because customers want the choice. We're going right after those EMC installations. EMC architecture is 10 years old. Shark is new. Customers now have a choice. That's driven a lot of the success that we've had.