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Dell moves to top of growing iSCSI SAN market

IDC confirmed Dell’s claim that it has moved into the No. 1 spot in iSCSI SAN market share following its $1.4 billion acquisition of EqualLogic. According to the IDC quarterly storage numbers for the first quarter released today, Dell passed EMC and NetApp to take the lead with 27.7 percent of the iSCSI market. Overall, IDC pegged iSCSI as accounting for 6.1 percent of the overall external disk storage revenue — up from 4.1 percent a year ago and 5.1 percent in the fourth quarter of 2007.

It appears that a good chunk of the market share Dell gained came at the expense of its storage partner EMC. EMC, which co-markets Clariion systems with Dell, slipped from 18.2 percent to 15 percent of iSCSI market share in one quarter. Does that mean Dell customers are buying EqualLogic systems instead of Clariion AX iSCSI boxes? Maybe, although Dell still accounts for about one-third of overall Clariion sales.

NetApp increased its iSCSI share from 18 percent to 20.5 percent to move ahead of EMC while slipping behind Dell. No other major vendor has more than 4.7 percent of the iSCSI market, with the “other” (all vendors except for Dell, EMC, NetApp, HP, IBM, Hitachi, and Sun) category at 29.3 percent – nearly twice as much as “others” have of the Fibre Channel market. The others’ iSCSI share actually came down – it was 40.1 percent in the fourth quarter — reflecting  the shift of EqualLogic’s revenue from others to Dell.

It’s a good bet that LeftHand Networks sits in fourth place overall with a large piece of the others’ share. LeftHand was considered a close second to EqualLogic among private iSCSI vendors before Dell scooped up EqualLogic. LeftHand remains private and we don’t know its financials, but marketing VP Larry Cormier said it is picking up 200 to 300 customers a quarter. . .some of those because EqualLogic is no longer independent. “Some shops just won’t buy Dell,” he said.

In any case, with iSCSI drivers such as server virtualization and the eventual emergence of 10-Gig Ethernet fueling interest and the vendor landscape changing, the iSCSI space will be interesting to watch over the next year. . .just as converged Fibre Channel/Ethernet networks may blunt iSCSI’s encroachment into the enterprise.

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The rise of virtual machines and 10GbE are enablers for the rise of iSCSI. Personally, I don't think FCoE will save Fibre Channel - it doomed in the long term. But just as those things enable iSCSI, I think iSCSI also enables others. Things that were too difficult and complex for many customers - such as clustered NAS, replication for DR, and tiered storage that required SAN's - now become much easier when the SAN is the same switched Ethernet fabric you've been managing all along. Big enterprises have had these things for a while, but iSCSI makes them much more feasible for the mid-sized enterprise. Dell, in particular, is in a unique position to provide value-add server-based features in front of its Equallogic arrays by hosting things like file serving, clustered NAS, and storage optimization on Dell servers and blades that could be bundled with and leverage Equallogic.
Hi Dave, great article! Unforutnately, these numbers count "as sold" rather than "as built". For some people, this matters, others perhaps not. To be specific, as I understand it, HDS doesn't get credit for sales through HP and Sun, NetApp doesn't get credit for IBM sales, EMC doesn't get credit for Dell, FSC and others, and so on. Just something to keep in mind, as the various ranking change when you take this view. Thanks!