StorageTek looks beyond tape for back-up

There is a common perception about magnetic tape technology: that it is outmoded and destined to fade in importance. Yet, the reality is that tape is still the cheapest and most widely used medium for backing up, archiving and – crucially – for reliably restoring enterprise data.

Executives at Storage Technology (StorageTek), the leading supplier of automated


Company: Storage Technology

Main products: L-Series automated tape libraries; T-series &DLT/LTO tape drives; Virtual Storage Manage for virtual tape management; Shared Virtual Array (SVA) disk systems

CEO: Pat Martin

HQ: Louisville, Colorado

Status: Publicly listed on the New York Stock Exchange

Key financials: For its financial year 2001, the company reported a net income of $67 million compared to a loss of $1.8 billion a year earlier, on revenues down 1% to $2.1 bilion.

Key competitors: IBM, Quantum, ADIC

Infoconomy comment: StorageTek is the market leader in the $2.4 billion tape automation market. Its 29% share is well ahead of IBM’s 20%. But as disk prices continue to fall, it needs to offer a broader storage product line.



tape systems, have always banked on that reality. Tape drives, libraries, cartridges, management software and related services generate the bulk of the company’s $1 billion in annual revenues, accounting for around 80% of its overall sales in 2001.

But StorageTek realises that, long term, tape is not going to be enough. As the price of disk storage drops to a few cents per megabyte, the attraction of backing up to the more flexible medium of disk will only grow. StorageTek has two responses to that. It has developed a series of ‘virtual tape’ systems that make managing tape much more efficient. At the same time, the company is trying to revive its ambitions in the disk systems market where its ‘Iceberg’ line once made it a direct challenger to the mighty EMC.

Most significantly, in August 2002, the company launched the V2x Shared Virtual Array (SVA), a disk system that automates the allocation of capacity to ensure that organisations can obtain much better disk utilisation than the 20% to 60% levels they have historically achieved.

A key differentiator of SVA against competing products from EMC, IBM and HDS, says Steve Delmege, marketing director for StorageTek in the UK, is that it dynamically distributes storage capacity at the disk sub-system level, whereas rival products require a storage administrator to manage these volumes.

However, such innovations have had only marginal impact on StorageTek’s revenues. In 2001, disk systems accounted for just 10% of its overall revenue. Faced with entrenched competition in the disk array market, StorageTek will require further, dramatic innovation if it is to engineer a major shift beyond tape.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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