Called the PowerVault MD3000i, the box competes directly with products that Dell is already OEM’ing from EMC, such as the Clariion AX-150i, also an iSCSI box that can be bought for less than $5,000.

Making what Dell said was its biggest ever storage product launch, CEO Micheal Dell said in a web-cast conference that rival products aimed at small and mid-sized customers either cost too much, or really don’t do what you want them to do.

You can look at the storage vendors and the industry and say that they really haven’t met the unique needs of small and medium-sized companies, he said.

Sounding remarkably similar to other vendors that claim they are, in fact, meeting the needs of SMB customers, Dell went on to claim that the MD3000i is a simple and affordable yet capable device tailored to suit the requirements of customers who cannot afford to hire staff with esoteric storage management skills.

Dell put a lot of emphasis on the virtues of iSCSI, which runs on cheap and familiar Ethernet networks, as an alternative to using more complex and more expensive Fibre Channel technology to build storage networks.

Since Dell renewed its OEM relationship with EMC in 2001, all of its block-level disk arrays have been designed by EMC, and have shipped with Dell-EMC badges. The arrangement has been very successful for both companies.

Dell’s storage revenue is still only a single digit percentage of the company’s overall business, but it has been growing steadily and has just recorded a bumper second quarter increase of 25%. The share of EMC’s revenue that comes from the Dell OEM has been inching for the last six years, and is now at 16%.

Dell yesterday was keen to make soothing statements about its relationship with EMC, which it said is as strong as ever.

But when Dell executives were asked about the obvious overlap between the MD3000i and the AX-150i, they were on difficult ground. Overall the message was that the AX-150i is fine for EMC shops that have dedicated storage stuff, but not for SMBs.

The Dell-EMC devices are focused more at storage management solutions, and organizations with storage management teams, said Howard Shoobe, senior manager for storage at Dell. These [MD3000i] PowerVault boxes play are focused on a part of the market we haven’t played into with the Dell-EMC. That’s the market for devices costing under $50,000, where 35% to 40% of sales are still from suppliers in the ‘others’ category.

But what about the AX-150i, which carries a sub-$5,000 price tag and so is clearly in that price band? The AX-150 is perfect for customers who already own EMC products and value [EMC’s device manager software] Navisphere, or want to replicate data to other EMC boxes, Shoobe said.

Navisphere was mentioned by name more than once by Dell executives, who clearly think it is too complicated for SMB customers.

Other advantages that the MD3000i has over the AX-150i is a common management interface with Dell’s server management software, and the use of 3.5in SAS drives that are also the same as those used in Dell’s servers.

Dell is very, very successful in the SMB space in general. This is us using our expertise to drive into this storage space, Shoobe said.

While the AX-150i only scales to 12 disk drives, with expansion shelves the MD3000i can run up to 45 drives, making it a much larger device. While the Dell-EMC line-up includes Clariion arrays with this much capacity and iSCSI interfaces, they are the much more expensive Clariion CX variants.

This launch is about the fact that Dell is strong believer in iSCSI at the low end, said a marketing executive for a rival storage company who did not want to be named. Although EMC added iSCSI support to all of its Clariion disk arrays around three years ago, only the cheapest of those devices – the AX-150i – is really affordable by SMBs, the executive said, adding that the AX-150i has limited capacity because EMC does not want it to cannibalize CX sales.

I don’t think Dell objects to having overlapping products, the executive said.

The MD3000i box is the sister device to an MD3000 direct-attached external disk array that Dell launched last year – but did not publicize.

Dell insisted that it designed and developed the devices, including the most important part of any external disk arrays, which are the controllers. The MD3000 series includes volume copying and snapshot software, Dell said.

That would appear to rule out reports from last year that Dell was about to OEM the same Simplicity arrays controllers from LSI that are now powering IBM’s low-end iSCSI disk arrays.

EMC was unable to reach Computer Business Review with a comment by press time. Part of EMC’s efforts to develop its low-end business has to been to develop an EMC-Insignia brand to be attached to low-end products.

At the beginning of the year EMC said that it had disbanded Insignia marketing group, but said that despite this it was not giving up on its efforts to develop the brand, or a low-end channel.

Our View

This launch does not represent a major split between Dell and EMC, but it does underline the potential problems that EMC — originally formed to sell mainframe storage — might be having trying to condescend to small businesses with no interest in storage esoterics.

Could Dell end up moving on from the MD3000i into competion with EMC further upmarket? That’s very unlikely, because it would require Dell to dive into design and development waters it has never entered before. Dell is a manufacturing and supply specialist, not an engineering company. Even though the MD3000 is a low-end device, Computer Business Review was surprised that Dell is adamant that it designed it itself.

The move should scare those others who currently own 35% to 40% of the bands 1 to 3 storage market, and which Dell clearly has very much in mind.

On a separate note, Micheal Dell confidently told web-cast viewers that Last year, Internet users created 161 exabytes of information, which is equivalent to 12 stacks of books stretching from the earth to the moon.

That did not show much respect for the facts. According to a 2006 IDC report sponsored by EMC, the amount of digital information handled in any form last year was 161 exabytes. To reach that money-shot number, IDC counted in every possible form of digital content possible, including even temporary information such as telephone conversations and digital TV broadcasts.