Storage software market sees substantial growth

Two analyst reports both conclude the storage software market is on the up.

Good results

The storage software market is recording record revenues and looks set to continue to grow healthily over the next four years, according to two separate analyst firms.

A recent report from IDC claimed the last quarter of 2011 showed the best results ever for storage software, with revenue increasing by over 10 per cent year-on-year to almost $3.8 billion (2.4 billion).

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Storage device management software and data protection/recovery software were the biggest drivers of the growth, with revenues from these two market sections rising 17.3 per cent and 13.8 per cent respectively during the three month period.

The real value in any storage architecture or platform is in the software.

Archiving software also gained from the boost in the market, with revenues for the smaller but still important sector growing by 12 per cent over the year and 7.3 per cent in the fourth quarter alone.

These positive results are no one off, however, according to a report released today by TechNavio.

The analyst firm has predicted the market will grow at an annual rate of 7.5 per cent over the next four years, thanks to the need for "secure and easy access" to data.

Not all will be well in the market though, with the risk of storage vendors becoming a jack of all trades, rather than specialists.

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The worldwide storage software market has "been witnessing the consolidation of storage software and hardware solution vendors," read TechNavio's report.

"However, increasing operational costs due to lack of expertise could pose a challenge to the growth of this market."

Both IDC and TechNavio agreed on who were the top dogs in the market though.

EMC currently holds the largest market share, with over 25 per cent according to IDC, and TechNavio still sees the firm as the most dominant player going forward.

Both analyst firms also cited IBM and Symantec as big players both now and into the future. Sadly for NetApp, it made TechNavio's list but was left off of IDC's top companies to watch.

Simon Robinson, research director at The 451 Group, agreed the storage software market was very strong.

"The real value in any storage architecture or platform is in the software. The hardware layer is a total commodity, but turning a bunch of commodity disks and CPUs into a [well] performing and reliable storage system requires lots of smart software," he told IT Pro.

"This is why storage vendors still enjoy very healthy margins, but is also an area that a new wave of start-ups are starting to attack with lower-cost alternatives that offer 'good enough' performance and functionality."

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