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Spending on external disk storage systems remains firm in Western Europe: report

IDC’s report IDC’s EMEA Quarterly Disk Storage Systems Tracker revealed that external disk storage systems (EDSS) factory revenues in Western Europe grew 7% over last year to $1.23bn in the third quarter.

Notwithstanding an unabated slowdown in growth, year over year comparisons were helped by the appreciation of European currencies against the US dollar. However, constant currency calculations reveal a more complex picture and an overall decline of 2%over the same period last year.

The market declined 3% over the second quarter, as spending on high-end storage systems weakened sequentially as a strong wave of mission critical refreshes passed. This quarterly drop saw that the regional spending on high-end was virtually flat over last year.
This is the second yearly decline of quarterly of Western European EDSS market in a row.

Though the eurozone crisis puts the market under stress, the disk storage systems market remained resilient withstanding economic turmoil, owing to growth in segments and markets that otherwise have had tough conditions to contend with.

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IDC’s European Storage Group research director Donna Taylor said that over the last four quarters, high-end disk storage systems experienced a strong deployment cycle in which Western European enterprises spent $1.5bn, not including additional software and professional services content. "Last quarter we passed the high point of this cycle. Enterprises continued to spend on mission-critical system refreshes, storage consolidation projects, and cloud-enablement deployments, albeit more moderately," said Taylor.

Demand for overall midrange configurations (priced between $25K and $250K) improved sequentially by 4%, beating historical seasonal trends, and by 2% year over year. IDC’s data shows that market activity was at pre-crisis level during the third quarter. Therefore, this segment outperformed the market.

Entry-level disk storage systems (selling for less than $25K) performed well, with a 10% increase in dollar value over last year. SMB deployments drove sales of very cost-efficient external storage systems priced between $10K and $15K, which saw a year-over-year growth rate of 17%.

EMC continued to dominate the Western European market for external disk storage systems, with overall turnover unmatched by any competitors.

The Symmetrix business is increasingly challenged by HDS and HP, while the midrange space is highly competitive in all price bands due to the continuous upgrades from rivals. Despite this strong headwind, EMC managed to outperform the overall market by adding 13% more dollar revenue compared to last quarter, as VNXe, Isilon, and Data Domain added incremental revenues to the top line.

HP pulled off a strong quarterly performance and grew its market share over the second quarter. This enabled HP to recapture the second spot. HP’s 3Par systems made further inroads into Western European enterprises and service providers, while the resurgent VTL business registered record revenues. Legacy business sales, including EVA, MSA, and P9000/XP, held up healthily.

Though NetApp had 18% year-over-year growth, its revenues dropped 11% sequentially, allowing HP to overtake NetApp in sales.
IBM revenues remained flat despite a weakening dollar against the European currencies. Only DS8000 sales were stable and still accounted for the single biggest source of revenue for the company, while XIV failed to grow. Storwize V700 too added over $20 million to IBM’s top line which was offset by declining DS5000 sales for the quarter.

Dell regained fifth spot with large scale Compellent sales across the region, helping it to achieve 10% sequential growth in a seasonally weaker market, despite a decline in the end to the company’s EMC OEM partnership.

Hitachi Data System showed the largest year over year gain at 23%, but lost the fifth place to Dell.

United Kingdom had the strongest yearly growth, while Germany experienced a year over year decline of 4%. France was boosted by the currency impact, with high-end systems generating some organic growth. Big fall in the high-end segment in Italy during the third quarter due to budget freezes in the government and financial sectors was compensated by sales of midrange and entry-level price segments.
This article is from the CBROnline archive: some formatting and images may not be present.

CBR Staff Writer

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