Recent press reports about a bidding war for 3PAR bring into focus the expanding need for enterprise class data storage subsystems. What exactly is enterprise storage?
Defining enterprise storage is frought with problems but I will take a shot. Enterprise class data storage has:
- Enhanced reliability, high availability and serviceability – meaning it hardly ever fails, it keeps operating (on redundant components) when it does fail, and repairing the storage when the rare failure occurs can be accomplished without disrupting ongoing storage services
- Extreme data integrity – goes beyond just RAID storage, meaning that these systems lose data very infrequently, provide the latest data written to a location when read and will tell you when data cannot be accessed.
- Automated I/O performance – meaning sophisticated caching algorithms that try to keep ahead of sequential I/O streams, buffer actively read data, and buffer write data in non-volatile cache before destaging to disk or other media.
- Multiple types of storage – meaning the system supports SATA, SAS and/or FC disk drives and SSDs or Flash storage
- PBs of storage – meaning behind one enterprise class storage (sub-)system one can support over 1PB of storage
- Sophisticated functionality – meaning the system supports multiple forms of offsite replication, thin provisioning, storage tiering, point-in-time copies, data cloning, administration GUIs/CLIs, etc.
- Compatibility with all enterprise O/Ss – meaning the storage has been tested and is on hardware compatibility lists for every major operating system in use by the enterprise today.
As for storage protocol, it seems best to leave this off the list. I wanted to just add block storage, but enterprises today probably have as much if not more external file storage (CIFS or NFS) as they have block storage (FC or iSCSI). And the proportion in file systems seems to be growing (see IDC report referenced below).
In addition, while I don’t like the non-determinism of iSCSI or file access protocols, this doesn’t seem to stop such storage from putting up pretty impressive performance numbers (see our performance dispatches). Anything that can crack 100K I/O or file operations per second probably deserves to call themselves enterprise storage as long as they meet the other requirements. So, maybe I should add high-performance storage to the list above.
Why the sudden interest in enterprise storage?
Enterprise storage has been around arguably since the 2nd half of last century (for mainframe systems) but lately has become even more interesting as applications deploy to the cloud and server virtualization (from VMware, Microsoft Hyper-V and others) takes over the data center.
Cloud storage and cloud computing services are lowering the entry points for storage and processing, enabling application deployments which were heretofore unaffordable. These new cloud applications consume storage at increasing rates and don’t seem to be slowing down any time soon. Arguably, some cloud storage is not enterprise storage but as service levels go up for these applications, providers must ultimately turn to enterprise storage.
In addition, server virtualization transforms the enterprise data center from a single application per server to easily 5 or more applications per physical server. This trend is raising server utilization, driving more I/O, and requiring higher capacity. Such “multi-application” storage almost always requires high availability, reliability and performance to work well, generating even more demand for enterprise data storage systems.
Despite all the demand, world wide external storage revenues dropped 12% last year according to IDC. Now the economy had a lot to do with this decline but another factor reducing external storage revenue is the ongoing drop in the price of storage on a $/GB basis. To this point, that same IDC report stated that external storage capacity increased 33% last year.
Why Dell & HP wants 3PAR storage?
Margins on enterprise storage are good, some would say very good. While raw disk storage can be had at under $0.50/GB, enterprise class storage is often 10 or more times that price. Now that has to cover redundant hardware, software/firmware engineering and other characteristics, but this still leaves pretty good margins.
In my mind, Dell would see enterprise storage as a natural extension of their current enterprise server business. They already sell and support these customers, including enterprise class storage just adds another product to the mix. Developing enterprise storage from scratch is probably a 4-7 year journey with the right people, buying 3PAR puts them in the market today with a competitive product.
HP is already in the enterprise storage market today, with their XP and EVA storage subsystems. However, having their own 3PAR enterprise class storage may get them better margins than their current XP storage OEMed from HDS. But I think Chuck Hollis’s post on HP’s counter bid for 3PAR may have revealed another side to this discussion – sometime M&A is as much about constraining your competition as it is about adding new capabilities to a company.
What do you think?