The mid-range storage sector is poised to take off. Since SMEs cannot afford high cost enterprise solutions and mid-range systems come packed with some enterprise features, decision making isn’t too complicated. Gaurav Patra looks at the structure, the players and the market outlook for mid-range storage systems

The high-end market is limited to a few large outfits, while mid-end is a huge market and the are a lot of opportunities for players, says P P Subramanian

In spite of the slowdown, storage is one market which experienced good growth in the last fiscal. IDC India’s latest report on the storage market in 2002 says that there was a 74 percent increase in the storage management market in the country, from $8.5 million in 2000 to $14.8 million in 2001.

Within this market, the mid-range segment has tremendous growth potential, as indicated by the number of companies foraying into it. Some storage majors like Dell and Hitachi Data Systems (HDS) have introduced mid-range storage solutions. The mid-range will grow primarily because of the advantage these storage systems have in terms of their capability to offer enterprise performance for less.

Some of the storage systems like Dell’s beefy NAS system, Hitachi’s Thunder 9500V and EMC’s Celerra NS 600 are all mid-range storage systems. Even HP has some mid-range offerings like Ultrium Autoloader, VA Series, MSL Library, B2000/NAS8000 NAS, entry level FC switch and OV SAM.

World wide this is considered to be an emerging sub-segment within the storage segment. "There is a trend in countries such as Korea, Singapore, US, Australia, Brazil, China and also in India. In fact there have been a couple of tie-ups in this space this year, such as EMC-Dell and Sun-HDS,” says P K Gupta, director, strategic development, ICON operations, Legato Systems India. Comments P P Subramanian, country manager, India, HDS, “The mid-segment was always a future plan in most roadmaps. The process is like a pyramid. Once the top of the pyramid is adequately covered and converted, the focus automatically drifts towards the mid-range, and this segment has vast potential and opportunities.”

But why mid-range systems? Everyone, especially Indian small and medium enterprise (SME) cannot spend money on high-end storage systems which are priced in the range of $100,000. At the same time, storage demand is increasing at around 80-100 percent in almost every organisation. Factors like e-mail and reference information is driving this growth. SMEs have already started realising the importance of storage, and the Indian SME segment is considered to be a huge market, which explains why so many vendors are jumping in.

“The high-end market is limited to a few large outfits. But the mid-range is a huge market and there are lots of opportunities for players,” says Subramanian. Many of the tools once found only in high-end storage products are now available in mid-tier systems. This is because medium scale enterprises have the same set of issues that big enterprises encounter.

Yet in the same way that high-end storage technology has found its way into mid-range storage systems, high-end storage problems have also trickled down to mid-size companies, so the problems/issues are the same for both high-end and mid-range customers. Those mid-range customers who do not have the IT structure of big companies, or do not have the same expertise in-house, will also go in for mid-range storage solutions. “The mid-sized companies are more likely to buy something that is targeted at the mid-range enterprise and comes in a simplified package,” comments Avijit Basu, marketing manager, network storage solutions, HP India.

Providing high-end features at low-end prices is difficult but not impossible. It depends on products positioning, says P K Gupta

High-end features at low-end prices
Product features are among the key criteria in the technology domain. Companies are now aiming at providing some of the high-end features at low-end prices. Dell has plans to ship a low-end PowerVault 725N series storage system that can grow to meet demand. The rack-mounted PowerVault 775N and tower-configured PowerVault 770N will store up to eight terabytes of data internally, and operate on a Dell-EMC storage area network that can store up to 40 terabytes of data. Users can manage files from just about any client, including Linux, NetWare, and Unix. Plus, for the first time in a Dell NAS system, users can take snapshot copies of data for backup purposes while a network remains up and running.

HDS has launched a mid-range storage system—the 9500V series, to bring enterprise functionality and increased manageability to departmental storage systems. “We always had a mid-segment offering. Now we have also tried and included a lot of features and functionalities into our new mid-end offerings,” informs Subramanian. This product offers virtualisation software to help companies make the most efficient use of all the components on a storage area network, from servers to host bus adapters. Capacity ranges from 200 gigabytes to 30 terabytes.

Support for the common information model within the 9500 V Series’ HiCommand Device Manager software means administrators can manage the systems, as well as HDS’ enterprise-grade lightning storage and other vendors’ hardware, from one console.

Most of these players are talking about providing high-end features at low-end prices. But is this strategy profitable? Since the mid-segment is many times larger in size than the enterprise segment, players will definitely look at numbers. The greater the volumes, the higher the profits-this is expected to be the strategy of all these storage majors. “Providing high-end features at low-end prices is difficult, but not impossible. It depends on how the product is positioned. A simple example is EMC Celerra SE version, which is being introduced into the mid-range market but has lot of high-end features,” comments Gupta

Pros and cons
In comparison with high-end systems, these mid-range storage devices are cheaper. They are very easy to scale with growth, and as compared to high-end systems, have smaller footprints. They require less space, are simple to install, and easy to use.

However they also have some disadvantages. Since mid-range systems are non-enterprise ones, they will not have the same robustness. In comparison with high-end systems, the software in these mid-range storage solutions is also less powerful.

SME is one sector that will boost the growth of mid-range storage segment. Other verticals like manufacturing, medium-sized software developers, mid-sized banks, government establishments and educational institutions are also expected to opt for the mid-range. All these verticals basically use SANs, NAS, direct attached disc and tape automation alternatives for storage solutions.

Although mid-range storage systems will not directly challenge their high-end counterparts, there will still be a clash of the classes. “The weaker salesman will always try and sell the mid-range to the enterprise customer. But the solutions-oriented salesman/consultant will never make this mistake, though in rare cases the mid-range may make a better value proposition to the enterprise customer,” feels Subramanian. Since mid-range systems offer enterprise performance for less, some enterprises might be using mid-range systems for mission critical application storage requirements. Concludes Gupta, “Although mid-range systems will challenge high-end ones, enterprise systems will always have a place in the market since mainframe computers are still being sold and used.”