An investment banker's view into the storage crystal ball
By Alan Earls (RBC updates added by Michele Hope, Senior Site Editor)
RBC Capital Markets (formerly Dain Rauscher Wessels, or DRW, a division of Dain Rauscher Incorporated), recently unveiled a hefty 110-page overview of the networked storage market titled, "System Area Networks: The Next Generation of Scale in the Data Center."
The RBC Capital Markets corporate and investment banking unit was acquired in late 2001 by the Royal Bank of Canada. It performs extensive equity research -- including the Systems Area Networks report. And, while the report is somewhat lengthy, it's a terrific single-source overview of the state of the industry and of the positioning of key vendors.
The report's authors come to some predictable conclusions as well as some that are a bit more surprising. They include:
- Competition in storage will heat up significantly as traditional IT leaders collide with innovative newcomers -- each seeking part of the fast growing market.
- Virtualization will "even the playing field" in the conflict.
- Strong data storage vendors will be resilient and tough competitors.
- Plug-and-play will eventually become the rule -- but not for some time.
- Fibre Channel will survive and prosper.
- iSCSI will grow and expand but still faces some technical hurdles.
- InfiniBand will gain adherents but PCI may also get a new lease on life.
- 10-Gigabit bandwidth will have trouble unless it becomes possible to "attain high rates of bandwidth efficiency."
According to Thomas Curlin, a principal with the group, its history goes back about seven years. Curlin joined Robert Montague and Steve Denegri in late 1999. "Each of us came out of industry from engineering sales/manufacturing/development positions," says Curlin. "We cover the space as a team," he adds. Recently they moved their research practice from Morgan Keegan to DRW, which later was acquired and renamed by RBC.
Curlin says his group helped to introduce Wall Street to Fibre Channel, storage area networks, system area networks, SAN virtualization, iSCSI, and InfiniBand. "We were also the first to host an investor conference focused on the space in 1998," he says.
The group plans to host its first conference under the RBC Capital Markets flag on January 10th and 11th of 2002 in New York. The conference will consist of public and private companies addressing the System Area Network opportunity through silicon, network, software, and system innovations. The audience will consist of public equity, private equity, and strategic investors, "as well as our industry contacts."
- The System Area Network report is available online at http://www.rbcdrw.com/san/.
- To read more about the firm's January 2002, invitation-only conference, see the following link.
- Visit our latest featured topic, 2002 storage predictions, for more insights on what's in store for storage over the next 12 months.
- What's on your mind regarding the state of the storage industry and positioning of key vendors? Visit our Sound Off Discussion Forum, and post your opinion.
About the author: Alan Earls is a freelance writer in Franklin, MA.