EMC is rebuilding its breached defences. Since early 2001 when arch rivals Hitachi Data Systems (HDS) and IBM mounted a strong competitive challenge, the company has been fighting
to halt the erosion of the runaway leadership position it held in high-end disk systems for almost a decade.
In 2001 alone, EMC’s market share of the enterprise disk array market crashed from a dominant 33% to 25%, according to industry research group Gartner Dataquest, and further ground has been lost since.
But EMC is no longer looking complacent. Aside from enhancing and aggressively cutting the prices of its Symmetrix high-end disk arrays, the company has sought to establish a much broader sphere of influence in storage.
Central to this is software. In the past year, it has channelled 70% of total R&D spend into growing and refining its base of products for efficiently managing stored data and networks of storage devices. Indeed, CEO Joe Tucci has set a goal of the company attaining 50% of revenues from software by 2004.
To get there the company has been beefing up its ControlCenter storage management suite that includes backup, platform monitoring, reporting, performance management, and ‘virtualisation’ for managing multi-vendor storage networks. And with positive effect. According to Gartner, EMC’s share of the storage management software market grew to 30% in 2001, giving the company a 10% lead over its nearest rival.
Meanwhile, with competition tough in the high-end market, the company has sharpened its attack on mid-range storage. After losing key Symmetrix reseller deals with Hewlett-Packard and Sun in recent years, other partners – most notably Dell – have become critical for driving sales of EMC’s mid-sized Clariion devices. At a departmental level, EMC has already had considerable success. In 2001, its Celerra line grabbed the number one spot in the market for networked attached storage devices from Network Appliance.
As such gains testify, the world’s largest storage systems vendor is not resting on its laurels.