Who sells most networked disk storage?

As our news story reports EMC retained its billing as the world's favourite supplier for disk arrays with external controllers according to a Gartner Group report that looked at 2006. The external controller-based disk storage market totaled $15.2 billion in 2006, 4.1 percent up on 2005.

1. EMC with 24.8 percent market share, up from 23.4 percent in 2005.
2. IBM with 19.4 percent share, an increase of 2.1 percent over 2005 and due to revenue growth of 17.3 percent year on year. Highlights of its year were NAS (network-attached storage) and mid-range disk products.
3. HP with 13.1 percent market share. This was down from 2005 and HP has been losing ground since 2001 when its share was 18.9 percent. IBM then had 11.9 percent and has grown much more strongly than HP in the intervening years.
4. HDS had a 9.5 percent market share, up from 8.5 percent in 2005 and overtaking Dell. It is doing well, particularly with TagmaStore.
5. Dell had a 7.6 percent market share that was 1.3 percent down on its 2005 share of 8.9 percent. Its year-on-year revenue growth was a mere 3.5 percent.
6. Network Appliance had a 7.2 percent market share and recorded very strong revenue growth of 21.7 percent. It is growing much, much faster than Dell and is on track to overtake it in 2007. In the last quarter of 2006 it grew its revenue 36.6 percent.
7. Sun with a 6.1 percent market share.

These seven vendors were responsible for 84.2 percent of world-wide external controller-based disk storage revenues, an increase over their 81.5 percent share in 2005.

Since Dell sells EMC kit then EMC's effective share was over a quarter of the market. As both HP and Sun sell HDS kit then HDS' share is much closer to HP's than the raw figures above suggest. IBM now sells NetApp products and, therefore, Network Appliance may effectively have a larger share than Dell already.

EMC and IBM are in a breakaway group. HP leads the next set of suppliers and has a significant lead over HDS, Dell and NetApp. HP will want to retain that lead and get closer to the front two ahead of it. NetApp and HDS will both want to steadily power through the group they are in and try to catch up the two front runners. This will be a multi-year effort.

Who sold the most disk drives in 2006?

Based on iSuppli numbers, in 2006 434.2 million hard disk drives were shipped, up 15.5 percent from 2005. Consumer electronics wanted a lot of them and external disk drives were a strong market sector: 2.6 million were shipped, a 37 percent increase on 2005.

Demand for 1-inch micro-drives slumped as device manufactuers turned to flash memory instead. Micro-drive supplier Cornice is moving to offer NAND flash memory product.

1. Seagate - 33 percent of all units shipped
2. Western Digital - 20 percent
3. Hitachi GST - 16 percent
4. Samsung - 10 percent
5. Toshiba - 9 percent.

The biggest threat to disk sales is flash memory. Because of the growing capacity and decreasing cost of flash as well as its better robustness, the market for micro-drives is contracting. The 1-inch disk drive market is most affected but it seems probable that the 1.8-inch micro-drive market could be next to face the flash challenge.

Hybrid drives, ones with spinning platters front-ended by flash cache, are already being built by Seagate and look likely to spread. These will only boost the credibility of flash as a spinning disk alternative.