Dell Seeks Ripe Opportunity in Data Storage

Dell Inc (DELL) has been making significant strides into the data storage market, which I believe has been one of the best decisions the company has made of late.  After acquiring the storage company Equallogic last year, Dell recently bought the e-mail archiving company MessageOne.  Just this month, Dell announced storage system and related services aimed at the small and medium size business segment. 

Targeted storage products aim to provide small and medium size businesses a way to save on space and power (the PowerVault MD 1120 storage device uses compact disk drives with high capacities).  Recent services offerings include disaster recovery as well as storage management solutions.  This move, I assume, has been in large part due to the high growth and niche nature of the external disk storage market. 

IDC says the external disk storage market grew 10.8% for the first quarter of 2008 compared to last year.  Despite EMC Corp.'s (EMC) dominant position in this market (roughly 21%), Dell, with its Equallogic acquisition, holds a sizable 9.3% this year on 17.5% revenue growth.  Differentiation and key strategic positioning should add to Dell's earning leverage as it fully capitalizes on this niche market and increasing demand for data storage.

Disclosure: None

Comments

[Tim Master]

Yes... except that Dell is soooooo heavily invested into iSCSI, the question is whether or not that will be able to adapt to FCoE when it hits broadly in the next 6-12 months.

Tim Masters
www.storagemonkeys.com/