Currently HP’s Windows-powered NAS boxes range in price from around $2,000 to around $8,000. Bob Schultz, senior vice president and general manager of HP’s storage business said that the company will expand that range up-market.

The virtual tape library, or tape emulator, is currently part of a reference solution. I wouldn’t be surprised to see us add that to our product portfolio this year, Schultz said. Other sources say this will happen for certain, around the middle of the year.

Although HP’s already offers NAS devices that support the iSCSI block-level IP-based protocol, the company has been overtaken by EMC Corp and IBM Corp, which are both now selling purpose built block-level iSCSI arrays, which offer better performance than combined file-level NAS and block-level iSCSI devices.

HP will launch block-level iSCSI arrays in the second half of the year, Schultz said, and sees iSCSI demand not at the high-end for use with stranded servers, but among very small customers. Generally we don’t see people looking to connect midrange or high-end arrays via iSCSI. The iSCSI appeal is to SMBs, and it’s the S in SMB that we’re talking about the companies with say four, five or six servers, he said.

That is the same market that EMC and IBM are aiming at with the iSCSI arrays that they recently launched. Compared to these two suppliers, HP is conspicuous by its absence from the iSCSI market, because of its strong midrange and low-end presence. Pre-merger, HP like IBM was an early iSCSI enthusiast, and as with its virtualization technology (see separate story), the company seems to have been put off by its early experiences in an undeveloped iSCSI market.

But HP is not going to miss much iSCSI action. The currently tiny iSCSI market accounted for less than 1% of the total $3.4bn market for all types of external disk arrays, according to IDC’s estimates for the third quarter last year. IDC told ComputerWire that it expects around 190% growth in iSCSI revenue this year.