Thursday, October 28, 2010

New definition of the "middle tier" - who will benefit from data deduplication?

The Empoprise-BI business blog (which is presumably where you're reading this item now, unless you're reading it on an authorized or unauthorized duplication service) has covered data de-duplication previously.

Sort of.

My previous post mentioned my efforts to download a report on data de-duplication, but didn't talk about the report itself (which was only available to select elite people like me who knew the right answers to questions to qualify to get said reports).

Well, now that I've run across a report on data de-duplication that is accessible to every English-speaking person, I can talk about it a little bit more. One interesting statement in the Internet Evolution post was the following one:

"Where the largest enterprise is supporting thousands or tens of thousands of users with hundreds of terabytes of data, and growing, many mid-sized enterprises may only be supporting 500-to-1000 users, on possibly more than 100 servers, with 100s of terabytes of backup data, and growing," Reine said in a recent brief. But unlike their larger counterparts, [David] Reine [of the Clipper Group] notes, midtier companies have a harder time managing the flood of unstructured data, including videos and photos, coming from employees.

Why does the post focus on the midtier companies? For three reasons. First, the big companies have already adopted the technology. Second, prices are coming down as the technology matures, making data de-duplication devices more affordable to companies. Third, there are obviously more midtier companies, meaning that the market is now much bigger, even with the price drops. Michael Singer of Internet Evolution noted the following:

"The average sale size for a de-duplication appliance is $50,000. Assuming there are 400,000 opportunities out there... that converts to $20 billion in sales over the next six to seven years," Bill Andrews, CEO of storage appliance manufacturer ExaGrid Systems Inc. , told analysts with research firm DCIG.

Top-tier vendors like EMC, Hewlett-Packard Co. (NYSE: HPQ), IBM Corp. (NYSE: IBM), Hitachi Data Systems (HDS) , and NetApp have adjusted their product lineups and services accordingly for midmarket needs.

And at least one company is reaping the benefits:

ExaGrid Systems, Inc. (, the leader in cost-effective and scalable disk-based backup solutions with data deduplication, today announced it achieved another record quarter, marking the company’s 13th consecutive growth quarter. During the quarter the company expanded its customer base to more than 750 customers and gained significant new market share.

So feel free to e-mail a text version of this post to all of your co-workers. If your IT staff is "forward-thinking" (as the data de-duplication vendors put it), corporate storage won't be impacted.
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