The Hindu Business Line : Drawing strength from storage

A RECENT survey from Gartner Dataquest, a unit of Gartner Inc, says that organisations across the Asia-Pacific are focusing more heavily on their storage resources - evident from the fact that in the first half of 2002 the Asia-Pacific external storage market amounted to $549 million.

Matthew Boon, principal analyst, Computing Platforms group, Gartner Dataquest, Asia/Pacific, says, "E-mail, video, digital imaging and audio information are contributing to a massive explosion in storage capacity. The demand from emerging data-heavy content technologies is being felt not just in the mature markets of the region, but from emerging markets, such as China, India, Malaysia, the Philippines, Vietnam and Indonesia."

According to the study, South Korea ranked first in the external storage revenues in the Asia-Pacific, recording higher external storage revenue than China, despite China being the number one in terms of server revenue.

Singapore and India registered fairly similar levels of overall regional market share. Boon says, "Interestingly, whether classed as mature markets such as Australia and Singapore or immature such as India, there continues to be a direct correlation between server revenues and storage revenues in many markets of the Asia-Pacific."

"While China today has not attained the number one status when it comes to external storage, compared to the server market, we do expect China to eventually account for a larger slice of the storage pie in the Asia-Pacific than South Korea," says Boon.

Meanwhile, the recently merged Compaq and Hewlett-Packard emerged as the overall market leader in external storage revenue with a 22 per cent market share and a 21 per cent market share in terms of actual external storage capacity.

"While HP emerged as the overall leading external storage vendor in the first half of 2002, this was largely due to revenue derived from the External Direct Attached Storage (DAS) market," says Phil Sargeant, research director for Gartner's Servers and Storage research in Asia-Pacific. "When we break down the segments, EMC was the leader in the SAN segment, while Network Appliance was the number one vendor in the NAS segment for the first half of 2002."

The study further says that in recent customer surveys, Gartner Dataquest continues to see organisations in the Asia-Pacific looking to networked storage to improve their overall storage infrastructure capabilities. During the first six months of 2002, networked storage (Storage Area networks and Network Attached Storage) accounted for a combined 48.5 per cent of total external storage revenue, with the remaining 51.5 per cent attributable to externally attached DAS storage.

Looking up on PCs

With the Asia-Pacific Personal Computer (PC) shipments reaching 21.7 million units in 2002, an 8.6 per cent increase over 2001, the Asia-Pacific PC market's growth rate has outpaced the worldwide PC industry which grew at only three per cent in 2002, says a Gartner Dataquest survey.

Speaking about the Indian market, Vinod Nair, research analyst - Hardware Platforms, Gartner India, says "While the slowdown and past events compromised its hardware growth rates, India managed to remain fairly resilient in the face of such adversity in 2002. PC shipments have grown around 11.8 per cent over 2001. Organisations that have been reluctant in utilising their hardware budgets have started easing their restraints. Though the pre-slowdown levels remain far from achievement, the market looks positive and there are indications that organisations are buying PCs."

"The large spenders continue to be Finance and Banking and Telecom verticals. Vendors are increasingly developing strategies to tap Government orders while education is gaining significance in terms of hardware spending," says Nair.

He, however, adds, "The white box segment still remains tough competition for branded vendors."

Lillian Tay, senior analyst for Gartner Dataquest's Computing Platforms Asia-Pacific group, says, " The Asia-Pacific market's growth rate was a significant contributor to the worldwide industry returning to positive growth in 2002. Much of the growth came from the home and the small and medium enterprise market, as well as demand for mobile PCs."

"Vendors actively pursued these markets with aggressive instalment schemes and bundling programs and introduced CRT monitor and PC trade in programs to stimulate replacement activities," Tay says.

As per the survey, while Legend maintained its leadership position as the number one PC vendor in the Asia-Pacific, Hewlett-Packard and IBM came in second and third, respectively. Dell was the only top-tier vendor to experience double-digit growth in 2002, as its shipments grew by 23 per cent.

"Dell was focused in countries such as China to build up the base there and that contributed to the growth rates while maintaining their strong hold on countries such as Australia, Malaysia and Singapore," Tay says.

In terms of country-wise shipments, China continued to be the dominant country in the region, as it accounted for 43 per cent of all PC shipments in the Asia-Pacific region. Much of the growth in the region came from countries such as Thailand and India, which experienced increases of 40 per cent and 12 per cent, respectively, according to Gartner Dataquest.

More mature markets such as Hong Kong and Singapore suffered negative growth rates in 2002 because of sluggish economies and unemployment rates, which hampered IT spending.

Mobile PC growth rate, meanwhile, was robust at 25 per cent as against the desk-based PC, which grew 6 per cent over last year. Mobile PC captured 16 per cent market share of total PC market this year compared with last year at 14 per cent. "Mobile PCs were at aggressive price points and the availability of numerous model offerings made it attractive for buyers," says Tay.

A recent Gartner end-user study showed that businesses in the Asia-Pacific are keeping their PCs for at least four to five years, which indicates that 2003 could be the year of replacement based on large pre-Y2K instalments. "However, buyers will continue to look carefully in acquiring PCs, scrutinising the business value of the investment rather than just keeping pace with technology features. Vendors have to make a case of the returns on investment, and those who can do it successfully will be the winners," Tay says.

nehak@thehindu.co.in

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