The Emerging Storage Area Network Market

As we enter the next millennium of storage technology, there is a trend toward re-centralization. The key drivers to this are the explosion of Internet Web content, deployment of large database applications, enterprise data warehouses, and data marts. These data-intensive applications have driven the storage market to double-digit growth.

Over the last few years, the indirect channel has been the primary beneficiary of storage market growth with revenue increasing 19.3% CAGR (compound annual growth rate), or $7.2 billion in additional revenue. With the forecast of the storage market growth expected to exceed 10% through 2003 combined with the growth of storage area networks, the opportunity for system integrators and VARs is substantial. As storage solutions become more sophisticated, they require a consultative sales approach and a better understanding of the customers' applications and business needs.

To meet growing storage needs, IT managers have found that deploying storage in the traditional manner (either host captive or point-to-point) is costly, but, even more importantly, it's becoming an arduous task to manage. Because of this prolific growth of information, many IT decision makers have determined that the best way to make data accessible is to make the storage decisions separate from server decisions. This is quite clear based on the reorganization of companies such as SUN, Dell, and Compaq. Each of these major server vendors has developed separate storage units to drive the sale of storage products separate from their server business. As storage and server decisions become more independent, so too do the opportunities for system integrators and VARs increase.

With SANs (storage area networks), additional storage can be added independent of the server, and the amount of storage that can be scaled up is virtually unlimited. Furthermore, additional storage can be added on the fly, allowing information to remain accessible while operations continue. There is no downtime, and storage configurations can be changed regularly.

Managing the centralized storage pool of a SAN can be much more cost-effective than trying to manage the traditional client/server models. With a SAN, all storage and systems on the SAN can be monitored and managed from a single management console. By separating the servers from the storage, there is no need to let available disk space go unused because storage devices are now consolidated.

Opportunity For VARs And System Integrators
Many early adopters of SANs bought pre-tested, pre-configured storage networks from storage and server vendors such as Dell and IBM. However, most IT managers prefer to build networks with best-of-breed hardware and software. Therefore, in the future, heterogeneity is going to be a fact of life and an excellent opportunity for VARs and system integrators to capitalize on. As was the case with LANs and WANs (wide area networks), these heterogeneous storage area networks will require close customer relationships that system integrators and VARs provide.

As a network-enabled storage solution, each SAN has some degree of uniqueness requiring a face-to-face consultative selling approach to determine the right solution and time frame for implementation. Because of the complexities of SANs, they are often phased in over time. To ensure a correct implementation strategy, customers will be seeking knowledgeable advice. Customers move slowly when building SANs and each phase represents a solution of its own. This provides additional consulting, service, and revenue opportunities over time. The VAR or system integrator that wins the customer's SAN business will be a partner in that business with a built-in return for many years as a customer evolves its SAN technology over time.

The need to access information will only increase as the requirements for data availability increase. SANs provide an opportunity to work directly with an end user to customize and design a storage strategy, allowing a VAR or system integrator to either expand its consulting services or move beyond a traditional application-, server- or hardware-solution provider. Someone has to guide the end user through the barrage of products and technology questions. Who better than a VAR or system integrator, a neutral trusted partner?