Enterprise storage market sees decline in quarter four
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Enterprise storage market sees decline in quarter four

Total worldwide enterprise storage systems factory revenue was down 6.7% year over year while reaching $11.1 billion in the fourth quarter of 2016 (4Q16), according to the IDC (www.idc.com) research group. Total capacity shipments were up 18.3% year over year to 52.4 exabytes during the quarter.

Revenue growth increased within the group of original design manufacturers (ODMs) that sell directly to hyperscale datacenters. This portion of the market was up 3.2% year over year to $1.2 billion. Sales of server-based storage declined 7.8% during the quarter and accounted for $3.4 billion in revenue. External storage systems remained the largest market segment, but the $6.4 billion in sales represented a year-over-year decline of 7.8%.

It should be noted that the size of the server-based storage market has been updated this quarter to reflect a change to IDC's enterprise storage systems taxonomy. IDC's new methodology for sizing the server-based storage market is now more inclusive than in the past, thus increasing the size of the market in terms of value, systems shipped, and capacity consumed. Changes to the server-based storage market have been applied retroactively to ensure continuity with past quarters.

"2016 represented a year of considerable change for the enterprise storage systems market," said Liz Conner, research manager, Storage Systems, IDC. "While the broader enterprise storage systems market has been impacted by headwinds, companies continue to increase their investments in several key areas, such as software-defined storage, cloud-based storage, all flash storage systems, and converged systems. As a result, traditional enterprise storage vendors have aligned their portfolios to meet the shifting demands.”

Dell Technologies was the largest external enterprise storage systems supplier during the quarter, accounting for 32.9% of worldwide revenues. HPE, IBM, and NetApp finished in a statistical tie for the number two position with 10.2%, 10.1% and 10.0% of market share, respectively. HPE's share and year-over-year growth rate includes revenues from the H3C joint venture in China that began in May of 2016; as a result, the reported HPE/New H3C Group combines storage revenue for both companies globally. Hitachi rounded out the top 5five with revenue share of 7.0%.

The total All Flash Array (AFA) market generated almost $1.7 billion in revenue during the quarter, up 61.2% year over year. The Hybrid Flash Array (HFA) segment of the market continues to be a significant part of the overall market with $2.5 billion in revenue and 38.4% market share.

IDC defines an enterprise storage system (ESS) as a set of storage elements used to provide persistent data storage resources including power supplies, cooling, system enclosures, storage controllers, system cabling & external connections, and storage media (HDDs and/or flash). An enterprise storage system may be located outside of or within an application server. IDC excludes storage networking (e.g., FC switches) and non-bundled storage software when sizing the enterprise storage systems market.

 

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