Are we witnessing the transformation from Target to Integrated PBBAs?
I drove past my local, soon to be former, Blockbuster store this weekend. Everything is now 80% off, including the store fixtures. It is the last one to go as there used to be three (3) Blockbusters in a two mile radius of my house. In its day, Blockbuster ruled the video rental business. However, consumer demand changed, new companies emerged to meet those changing demands, Blockbuster was not able to change, and today Blockbuster is offering 80% off store fixtures.
I believe a similar transformation is occurring in the purpose-built backup appliance (PBBA) market. Last week, IDC released their latest PBBA report, Worldwide Purpose-Built Backup Appliance (PBBA) Market Fourth Quarter 2012.
In the IDC Q4 2012 report, they reported Symantec had 4Q12/4Q11 Revenue Growth of 190.8%. To put it into perspective, the next closest OEM was Quantum at 21.2% and EMC in third with 7.0% growth. While EMC led the market with 66.5% share, Symantec moved into the Number 2 position with 11.8%, passing IBM at 8.4%.
A Different View - Again
As I did in my previous blog, IDC Purpose-Built Backup Appliance Report: a different view, I took a deeper view of the latest IDC numbers.
The question I wanted to answer, while the PBBA market is growing, who is driving this growth?
The answer: Symantec is driving the PBBA market growth! By nearly double of its closest competitor.
From Q4’11 to Q4’12, the PBBA market grew by $108.4M. Of this amount, Symantec accounted for $66.5M or 61.3% of the total PPBA growth.
Look at the other names on the chart above; all established and long-standing storage or backup companies. But why are they stagnant or losing market share in an industry that is growing 19.4% CAGR? That is what got me thinking about the transformation of the PBBA market, and video rentals.
Symantec’s growth is significant for two reasons and explains why the game is changing:
- Customers are looking for simplification and tighter integration within their environment. Many of the OEMs only offer a deduplication appliance, or point solution, which requires a third-party backup application (many are dependent on NetBackup software) for the backup data management and movement.
- Symantec has already helped with the integration piece for software and storage appliances with our OpenStorage (OST) program. To date, we have 13 partners participating in the program. However, customers wanted more capability, automation, and of course, simplicity.
- Deduplication only appliances add cost and complexity, when companies can least afford it. For example, most deduplication (target) appliances do not offer client side deduplication. Rather, the entire data set must be sent over the network to where it is deduped and stored. This makes it more expensive to move the data and impacts network performance.
- Symantec offers Integrated Backup Appliances. Symantec NetBackup 5200 series appliances seamlessly incorporate the server, storage, OS and most importantly the backup software into one appliance. And we are leveraging other Symantec components; Critical Server Protection (CSP), Storage Foundation – and adding more capabilities like WAN optimization to deliver even greater protection, availability, and performance. Our purpose-built integrated backup appliance provides the simplicity, and reduces the CapEx and OpEx that companies are demanding.
If you are considering a backup appliance, I encourage you to make an informed decision. As part of your evaluation process understand the differences between an Integrated versus Target backup appliances. The differences are important not only from a technology perspective, but for delivering business value.
Lastly, consider Symantec. We are introducing our third generation of our integrated backup appliances and it is based on industry leading NetBackup software. Symantec is driving the growth in the PBBA market with its Integrated Backup appliances because it is delivering what the market requires.
By the Numbers (or extra credit for showing my work)
Having three children, and having spent many evenings helping with math homework, I understand the importance of showing your work. Here is my work…
IDC reports on the Worldwide PBBA factory revenue numbers. It is important to understand that they also report and breakdown the numbers several different ways. For example:
- Hosted System: Open Systems or Mainframe. IDC press release is based on Hosted System revenue.
- Revenue: Factory or Customer. IDC press release is Factory.
For my analysis I used Open Systems and Factory revenue, and based on 4Q12/4Q11 growth.
|IDC PBBA Market Share Analysis - Open Systems (Factory Revenue)|
|Vendor||2012 - Q4||2011 - Q4||Industry $ Growth||Industry % Growth|
|EMC||$ 545.2||$ 510.6||$ 34.6||31.9%|
|Symantec||$ 101.3||$ 34.8||$ 66.5||61.2%|
|IBM||$ 27.9||$ 27.7||$ 0.2||0.2%|
|HP||$ 27.4||$ 32.9||$ (5.5)||-5.1%|
|Quantum||$ 20.6||$ 17.0||$ 3.6||3.3%|
|Fujitsu||$ 11.6||$ 8.9||$ 2.7||2.5%|
|Sepaton||$ 9.5||$ 9.8||$ (0.3)||-0.3%|
|ExaGrid||$ 9.3||$ 6.4||$ 2.8||2.6%|
|Dell||$ 8.8||$ 5.0||$ 3.8||3.5%|
|Other||$ 12.0||$ 11.8||$ 0.2||0.2%|
|Total||$ 773.7||$ 665.0||$ 108.6||100.0%|
- IDC Worldwide Quarterly Purpose Built Backup Appliance Tracker – 2012 Q4, Publication Date: 3/21/2013.