Alongside that sequential growth, Cisco said it also saw a year-on-year SAN growth of over 70%, making storage its fastest growing product category. But the sequential growth is the more important figure, because it reverses the 2% sequential shrinkage of the previous first fiscal quarter.
That shrinkage came because the first fiscal quarter followed the fourth fiscal quarter, when Cisco makes its traditional fiscal year-end sales push. Also Cisco faced a surge in competition from Brocade, which had just launched a raft of new products.
Cisco would not say what its second fiscal quarter storage revenue was in absolute terms, but was happy to forward a note from merchant bank AG Edward that estimated Cisco’s revenue at over $60m in its latest quarter.
That gives a run rate of around $240m per year, or about a quarter of the $1bn-odd total market for switches and directors in 2003. Since 2003, the market has grown only slowly in revenue terms, because growth in demand has been offset by rapidly falling prices. The price erosion has been driven in no small part by Cisco’s entry into the SAN sector in 2003.
