Take, for example, the storage market. Some players are highly insulated from the economic storm. Mike Ruettgers, EMC's executive chairman, was upbeat during a press conference in Europe on March 22. And Veritas Software CEO Gary Bloom was equally optimistic during an exclusive interview with Sm@rt Partner last week.
Still, thunderclouds dominate the sky, and some storage companies won't survive to find shelter. In recent weeks, tape-drive maker OnStream shuttered operations; Exabyte slashed its workforce by 24 percent; Texas Instruments closed a chip plant for disk drives in Santa Cruz; Brocade, Emulex and Quantum issued earnings warnings; and service providers like Storage Networks are encountering some bumps, according to storage-market analysts.
Few people expected the storage downturn to come so quickly. "I think we were surprised that even storage is vulnerable, [considering] the importance of storage in the IT network," says John Webster, a senior analyst at market research firm Illuminata.
Take a raincheck
These days, many customers are delaying expensive storage-area network (SAN) initiatives. SANs take months to design and deploy, and often require platform-specific hardware or specialised software.
For some customers, SANs are difficult to cost-justify at a time when many businesses are trimming corporate travel, halting free coffee and canceling other perks to retain cash.
Nevertheless, customers still need to manage and protect mounds of data. That's where point solutions come in. Instead of building a full-blown SAN, many customers are layering network-attached storage (NAS) or cross-platform backup software onto existing systems. So far, this shift has been subtle. But market watchers predict cross-platform storage specialists like Veritas will weather the economic storm better than most.
"I see [Veritas] in an extremely strong position," says Webster. "They have a very large and loyal customer base, and as hardware becomes more and more commoditised, the importance of software grows."
