10.15.03
Butterflies Aren’t Free
Just like Moore’s law in processors, storage continues to get denser and cheaper. While a gigabyte-size storage appliance would have cost about $50,000 in 1980, today a handheld 60-Gbyte drive can be ordered for $200 or less.
Not surprisingly, companies are buying more storage and spending less. According to IDC, in Q2 2003, worldwide shipments totaled 180 petabytes, a 36% increase in raw capacity, but a 4% revenue decrease over the same period last year. Businesses are piling up more transaction, business intelligence, and unstructured (e.g., documents) data, at a faster rate, than ever before.
But as companies accumulate data, they are spending even more on managing it. Gartner predicts that the storage resource management market will grow at a 24% annual clip through 2007.
And that’s why EMC has pushed the Information Life Cycle, a strategy to migrate the company from hardware to solutions provider. Over the past 90 days or so, it has bought two software companies to do just that: Legato, a Veritas wannabee in storage management, and just yesterday, Documentum, one of the largest players in document management.
The Documentum deal grabs our attention because this gets EMC beyond its pure infrastructure niche. Aside from hierarchical storage management (HSM) tools, the relationship between data value and storage management has been ephemeral at best. While business units have typically bought document management solutions, storage management has been the domain of the data center. Consequently, business folks keep buying enterprise applications with little if any idea on what it will cost to store all that data, while the IT folks end up buying solutions reacting to the data access bottlenecks that result.
As with any IT initiative these days, the ideal is getting the business and technology sides of the house on the same page, so both understand the true cost of ownership. Conceivably, with Documentum part of EMC, quantifying the total costs of managing more content should become more straightforward. At least, that’s the goal.
Nonetheless, EMC will face a missionary sell because of the different target buyer demographics. Not surprisingly, EMC plans to continue operating its two software acquisitions as separate business units — and if it continues to do so, both will simply amount to what the consumer goods industry characterizes as “brand line extensions.” EMC’s real challenge, however, is to forge a new target market that finally breaks the blood-brain barrier separating the data center from the rest of the enterprise.