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Storage Consolidation?

Every so often you hear the prediction of consolidation in the storage industry, especially during times where the economy is in question. Now is again one of those times and surely we will see some acquisitions here or there, but I think we are a long way off from the classic consolidate down to three vendors scenario. Here's why....

First, and with some measure of irony, the storage industry is really more about software than it is about hardware. Certainly hardware innovation happens and will continue to happen, but Original Equipment Manufacturers (OEM) like Xyratex are producing phenomenal solutions that allow innovators to focus on the software that wraps around this hardware and becomes what you know as a storage solution.

Innovation like virtualization, deduplication, storage clustering, and Network Attached Storage solutions are coming from what are primarily developers. Having access to solid hardware platforms allows these innovators to focus on creating. This also means that the barrier for entry isn't as high as it would be if these companies had to develop and maintain their own storage hardware offering.

The result is new opportunities and market-driven needs arise as storage companies or a developer of storage software can quickly assemble a team and start working on creating a solution. Cloud storage solutions like those from ParaScale or Cleversafe are great examples. These companies saw an opportunity in cloud-based storage infrastructures and were able to respond to the market.

The net effect of all this is that while there is occasionally some consolidation in the storage industry, and someone gets bought or goes out of business, there are new companies with new ideas being added to the storage community at a much faster pace.

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George Crump is founder of Storage Switzerland, an analyst firm focused on the virtualization and storage marketplaces. It provides strategic consulting and analysis to storage users, suppliers, and integrators. An industry veteran of more than 25 years, Crump has held engineering and sales positions at various IT industry manufacturers and integrators. Prior to Storage Switzerland, he was CTO at one of the nation's largest integrators.

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