Asia Pacific storage market achieved record 21% revenue growth

The market for external controller-based (ECB) disk storage in Asia Pacific excluding Japan (APeJ) hit record revenue of US$2.53 billion in 2010, a 21.2 percent increase from 2009, according to Gartner, Inc.

Storage revenue growth was consistently strong in the major markets in the APeJ region in 2010. Australia and New Zealand, South East Asia, Greater China and Korea all saw between 21% and 23% growth in revenue; India also grew nearly 18%. Australia, the second largest market in the region, achieved 19% growth after two sequential declining years.

“Organizations are accelerating storage investment to catch up with the fast-growing capacity and performance requirements, and using advanced technologies to improve storage efficiency and address the complexity issues,” said Jimmie Chang, principal analyst at Gartner.

“Economic recovery drove storage market growth in the region. Storage infrastructure modernization and consolidation driven by server virtualization, disk-based data protection plus expanded disaster recovery projects, multimedia-based applications, and emerging cloud storage services are the engines that are driving the ECB disk storage vendor revenue growth in Asia Pacific.”

Storage technologies

In 2010, monolithic and midrange modular systems grew faster than the lower-end market. This is opposite to what happened in 2009, when entry-level modular storage saw the fastest growth. As the economy was recovering, organizations reactivated high-end investment because they needed the advanced features to address the growing need to consolidate and manage data.

Block-access ECB storage still dominated in the APeJ region with 86% share of the market, and growth of 20% over 2009.

Network attached storage (NAS) grew 28% indicating strong demand for file-based storage, however it occupied only 13% of the total ECB storage market and its growth was still slower than the 36% worldwide average growth rate.

According to Gartner analysts, this means the value of NAS has not yet been fully recognized, especially in large markets such as China. Although content-addressed storage (CAS) declined in all other regions across the world, it saw an exceptional 40% growth in APeJ, mainly in Singapore and Australia. However, it represented only 1% of the total ECB market.

Storage vendors

Among the major vendors, EMC was the biggest winner in the APeJ region. With 34.1% revenue growth in 2010 and 41.5% year-on-year growth in the fourth quarter of 2010, the company easily retained the top position and left its challengers behind (see Tables 1 and 2 on the next page).

IBM’s storage revenue grew 15.9% in 2010, but it still lost 0.9% market share.

Thanks to a number of newly acquired product lines, HP remained in third spot, however its traditional revenue generators, EVA-series and MSA-series, were weaker against the competition.

Hitachi Data Systems performed well both in the fourth quarter and the full year 2010, especially in key markets like China, and has moved into the range to threaten HP’s third position. Oracle was the biggest loser in 2010, in that it lost about a half of former Sun Microsystems’ market share in 2009.