Articles for Storage

Sandisk Gains from Solid State Drive Storage Boom

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Friday, January 13th, 2012 by Trefis Team

This year could be a big one for SanDisk (NASDAQ:SNDK) as technology advancements, changing dynamics in the PC industry, new enterprise server and storage architectures, and near-term hard disk drive (HDD) shortages boost the worldwide solid state drive (SSD) storage market higher. According to a report from research firm IDC, the worldwide solid state storage industry revenue reached $5 billion in 2011, a 105% increase from the $2.4 billion in 2010, and is expected to expand further in 2012 and beyond. The report estimates the worldwide SSD shipments to increase at a compound annual growth rate (CAGR) of 51.5% from 2010 to 2015. SanDisk primarily competes with Samsung and Toshiba in the SSD market.

While SanDisk currently derives majority of its revenue from the sale of flash memory cards and USB drives, SSDs are fast becoming a major product segment. We estimate that SanDisk will be deriving more of its value from SSDs compared to flash memory cards and USB drives in the future. Below we take a look at the major factors driving growth in SSDs.

We have a $50.60 Trefis price estimate for SanDisk and will soon be releasing our new model for SanDisk with a separate break up for SSDs.

NetApp Set to Increase Prices as HDD Supply Shortage Continues

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Friday, January 13th, 2012 by Trefis Team

NetApp (NASDAQ:NTAP) is set to raise prices for hard disk drives (HDDs) in its storage arrays between 5% and 15% beginning February 6, 2012, due to the supply shortage caused by the floods in Thailand late last year. NetApp’s announcement comes after EMC‘s (NYSE:EMC) announcement of a price hike late 2011. Also HP (NYSE:HPQ), the global leader in disk storage systems market, is expected to raise its HDD prices by up to 20%, with the large capacity SAS and SATA drives being among the most affected.

We currently have a $46.73 Trefis price estimate for NetApp.

EMC Worth $42, Amps Up Focus on Network-Attached Storage Market with Isilon Acquisition

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Tuesday, January 10th, 2012 by Trefis Team

Since its acquisition of Isilon in late 2010, EMC (NYSE:EMC) has made making significant progress in scale-out network attached storage (NAS) market, a fast-growing segment under the total open networked disk storage market. While Isilon has long been leader in the scale-out NAS market, EMC’s ownership has provided a major boost to Isilon sales which are expected to double in the fourth quarter of 2011 from the $60+ million seen during the time of its acquisition. The Isilon acquisition has provided EMC a clear advantage over arch rival NetApp (NASDAQ:NTAP), which launched its ONTAP 8.1 scale-out NAS clustering product last year in response to EMC’s growing presence in scale-out NAS market.

We have a $42.15 Trefis price estimate for EMC, which is nearly double the market price.

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NetApp Targets Indian Mid-Market Growth as Storage Demand Takes Off

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Monday, January 9th, 2012 by Trefis Team

After being named the leader in the mid-range and high-end modular disk arrays last month by research firm Gartner, NetApp (NASDAQ:NTAP) is now focusing on mid-market businesses in India and has plans to increase its revenue from the segment from 21 percent in 2011 to 30 percent in 2012. The company has strengthened its low-priced storage product and solutions portfolio for midsize businesses and aims to add about 250 mid-market customers in the next 12 months in India. NetApp is currently the world’s third largest player in the external disk storage systems market behind EMC (NYSE:EMC) and IBM (NYSE:IBM).

We currently have a $46.73 Trefis price estimate for NetApp, about 30% above the market price.

Europe Will Drag on IT Spending in 2012

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Monday, January 9th, 2012 by Trefis Team

Worldwide IT spending is forecast to total $3.8 trillion in 2012, a 3.7 percent increase from 2011 according to the latest outlook report released by research firm Gartner. While not much of a surprise, the growth estimate for 2012 is much lower than the 6.9 percent experienced by the industry in 2011 primarily due to the impact of Eurozone crisis and hard-disk drive shortage resulting from the flooding in Thailand. Lower IT spending could impact players like Accenture (NYSE:ACN), IBM (NYSE:IBM), Microsoft (NASDAQ:MSFT), Oracle (NASDAQ:ORCL) and SAP (NYSE:SAP) while a hard drive shortage will weigh on HP (NYSE:HPQ) and Dell (NASDAQ:DELL) as well as enterprise storage vendors like EMC (NYSE:EMC), NetApp (NASDAQ:NTAP) and IBM.

The reduced spending is expected to impact all the four major technology sectors, including computing hardware, enterprise software, IT services and telecommunications equipment and services, which will witness low to mid single digit growth in the year.

EMC’s Worth $42 on Storage Software Market Growth

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Wednesday, January 4th, 2012 by Trefis Team

EMC (NYSE:EMC) is the global leader in the disk storage system market as well as the storage software market. However, EMC’s stock has fallen from the highs of around $30 during the middle of 2011 to about $21-22 in December 2011. Even NetApp (NASDAQ:NTAP), EMC’s only major pureplay storage competitor, saw its stock tumble in the second half of 2011 largely due to concerns of lower government and enterprise spending as the macroeconomic condition deteriorated in the U.S. and Europe.

Our price estimate of $42.15 for EMC is about double the market price. We believe that two key drivers of EMC’s stock and our views on those drivers explain why our price estimate is well ahead of the market price. Below we highlight these drivers in detail.

If Apple Acquires Anibot, Sandisk Better Watch Out

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Friday, December 16th, 2011 by Trefis Team

The rumors of a potential acquisition of Israeli component supplier Anobit, an Isreali flash storage solutions provider for the Enterprise and Mobile markets, by none other than Apple (NASDAQ:AAPL) is leading to speculation about the possible disruptive effects it could have on the NAND flash industry. Below we take a look at how this move could impact the NAND flash industry as well as the current leader in the flash memory controller chip market, SanDisk (NASDAQ:SNDK).

We currently have a $50.60 Trefis price estimate for SanDisk which is in line with market estimates.

See our full analysis of SanDisk

About Anobit

Anobit produces flash memory controller chip which manages the data stored on flash memory and communicates with computers or other electronic devices. Anobit’s MSP™ (Memory Signal Processing) technology is comprised of proprietary signal processing algorithms combined with advanced error correction and innovative flash management schemes that help improve flash memory’s endurance, performance and cost.

Why Apple’s Purchase of Anobit Could Be Disruptive to the NAND Industry?

According to Sanford Bernstein’s Mark Newman, flash memory controller chips “are becoming more critical to the performance of NAND flash” as they control error correction and signal processing.

The rumors of Apple’s interest in Anobit give weight to Newman’s claim. If Apple indeed acquires Anobit, it is likely that the computer maker will be making its own advanced NAND controller for its line-up of consumer hardware – the iPhones, the iPads and the Macbook Airs – in the future.

It is also possible that Apple will be providing its advanced NAND controllers to other consumer electronics vendors and storage system providers which would essentially commoditize flash memory suppliers.

SanDisk Will Be Worst Hit

The potential acquisition of Anibot by Apple could be bad news for SanDisk, the current leader in NAND controllers as well as other industry players like Micron Technologies (NASDAQ:MU), Samsung , and Toshiba, as Apple’s future dominance in the market could reduce them to mere suppliers of raw NAND.

SanDisk is primarily a flash memory storage solution provider to consumers as well as OEMs and not majorly into supplying raw NAND flash memory unlike Samsung and Toshiba. Apple’s entry into the flash memory controller chips would mean SanDisk will be the one to take the worst hit.

We are updating our SanDisk model to better account for new markets like enterprise and tablet SSDs.

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Storage Software’s Boom: EMC Holds Market Share While NetApp, Others Slip

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Tuesday, December 13th, 2011 by Trefis Team

According to a recent release by research firm IDC, storage software revenues reached $3.5 billion in the third quarter of 2011, up 9.7% over the same period last year. EMC (NYSE:EMC) maintained its lead with a 24.5% market share for the quarter, almost flat vs. last year, followed by Symantec (NASDAQ:SYMC), IBM (NYSE:IBM) and NetApp (NASDAQ:NTAP) with 15.3%, 14% and 8.8% shares respectively.

EMC Unveils Big Data Analytics Platform, $42 Fair Value

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Monday, December 12th, 2011 by Trefis Team

On Thursday, EMC Corporation (NYSE:EMC) unveiled the EMC Greenplum Unified Analytics Platform (UAP) – the next-generation platform to support Big Data analytics. EMC is pitching its Greenplum UAP as a single, unified data analytics platform that facilitates the discovery and sharing of insights from Big Data, which in turn lead to greater business value for customers. EMC estimates Big Data as a $70 billion market and is looking to come up with the best solutions to tap potential customers, as are competitors like IBM (NYSE:IBM) and HP (NYSE:HPQ).

We currently have a $42 Trefis price estimate for EMC

NetApp’s Slump Could Reverse to $46 on Disk Storage Business, Acquisitions

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Thursday, December 8th, 2011 by Trefis Team

According to data released by research firm IDC, the worldwide disk storage systems revenue increased 8.5% year over year to $7.6 billion in the third quarter of 2011. NetApp (NASDAQ:NTAP), the third largest player in the external disk storage systems market, saw its share increase to 12% in the quarter, up from 11.5% in third quarter last year. However, its share declined sequentially from 12.8% in the last quarter. On the other hand, NetApp’s rival and market leader EMC (NYSE:EMC) witnessed a 2.7% jump in its market share on a year on year basis but was flat sequentially.

We currently have a $46.73 Trefis price estimate for NetApp, about 25% above market price.