Market Momentum Driving Solid Growth in the Worldwide Disk Storage Systems, According to IDC

FRAMINGHAM, MA – June 6, 2008 – Worldwide external disk storage systems factory revenues posted 10.8% year-over-year growth in the first quarter of 2008 (1Q08) and totaling $4.9 billion, according to the IDC Worldwide Disk Storage Systems Quarterly Tracker. For the quarter, the total disk storage systems market grew to $6.7 billion in revenues, up 8.4% from the prior year's first quarter. Total disk storage systems capacity shipped reached 1,642 petabytes, growing 51.8% year over year.

"After a very healthy 2007, the disk storage systems market is carrying that momentum into 2008, with most product segments seeing solid growth in the first quarter," said Brad Nisbet, research manager, IDC. "It's clear that while organizations may be feeling squeezed in their overall IT budgets, the investments being made to store growing volumes of critical business data adequately are increasing. We see a long road of positive drivers fueling the opportunities for disk storage systems in the form of increased retention requirements and long-term data protection goals."

Total External Disk Storage Systems

For the first quarter, EMC maintained its lead in the external disk storage systems market with 21.4% revenue share, followed by HP and IBM with 12.4% and 11.5% revenue share, respectively. Dell, NetApp, and Hitachi ended the quarter in a statistical tie to round out the top 5 with 9.3%, 9.0%, and 8.9% revenue share, respectively. Among the top 5 suppliers, Hitachi and Dell posted the strongest year-over-year revenue growth during 1Q08, with 19.1% and 17.5%, respectively.

Network Disk Storage Systems

The total network disk storage market (NAS Combined with Open SAN) posted 14.9% year-over-year growth in the first quarter to more than $3.6 billion in revenues. EMC continues to maintain its leadership in the total network storage market with 26.4% revenue share, followed by NetApp and HP in a statistical tie with each holding 12.0% revenue share.

"The storage systems market was shining in the first quarter. Even segments that have been declining for quarters, including external direct-attach storage and JBOD, showed positive performance to start the year," said Natalya Yezhkova, research manager for storage systems at IDC. "This break in trends is attributable to the growing diversity of storage customers, including small and medium-sized businesses and content-centric customers, whose storage needs differ from those of the traditional customer base."

In the Open SAN market, which grew 14.7% year over year, EMC lead with 23.6% revenue share, followed by HP with 14.1%. The NAS market grew 15.5% year over year, led by EMC with 36.0% revenue share and followed by NetApp with 31.6% share. The iSCSI SAN market continues to show strong momentum, posting 67.6% revenue growth compared to the prior year's quarter. Dell, through its acquisition of EqualLogic, led the market with 27.7% revenue share, followed by NetApp with 20.5% share.

Top 5 Vendors, Worldwide External Disk Storage Systems Factory Revenue, First Quarter of 2008

(Revenues are in Millions)

Vendor 1Q08 Revenue 1Q08 Market Share 1Q07 Revenue 1Q07 Market Share 1Q08/1Q07 Revenue Growth

1. EMC $1,039 21.4% $912 20.8% 14.0%

2. HP $600 12.4% $575 13.1% 4.4%

2. IBM $560 11.5% $545 12.4% 2.7%

4. Dell (1) $450 9.3% $383 8.7% 17.5%

4. NetApp $435 9.0% $387 8.8% 12.4%

4. Hitachi $433 8.9% $364 8.3% 19.1%

Others $782 16.1% $745 17.0% 5.0%

All Vendors $4,858 100.0% $4,383 100.0% 10.8%

Source: IDC, June 6, 2008

(1) Note: Starting in Q1 2008, Dell is reported as the combined entity of Dell and EqualLogic.

Total Disk Storage Systems Market

In the total worldwide disk storage systems market, HP lead the market with 19.4% revenue share, followed by IBM and EMC in a statistical tie, with 15.6% and 15.4% revenue share, respectively.

Top 5 Vendors, Worldwide Total Disk Storage Systems Factory Revenue, First Quarter of 2008

(Revenues are in Millions)

Vendor 1Q08 Revenue 1Q08 Market Share 1Q07 Revenue 1Q07 Market Share 1Q08/1Q07 Revenue Growth

1. HP $1,310 19.4% $1,226 19.7% 6.9%

2. IBM $1,051 15.6% $1,105 17.8% -4.9%

2. EMC $1,039 15.4% $912 14.7% 14.0%

4. Dell (1) $679 10.1% $588 9.5% 15.5%

5. Hitachi $444 6.6% $373 6.0% 18.9%

5. NetApp $435 6.5% $387 6.2% 12.4%

Others $1,781 26.4% $1,625 26.1% 9.6%

All Vendors $6,739 100.0% $6,217 100.0% 8.4%

Source: IDC, June 6 2008

(1) Notes: Starting in Q1 2008, Dell is reported as the combined entity of Dell and EqualLogic.

Taxonomy Notes:

IDC defines a Disk Storage System as a set of storage elements, including controllers, cables, and (in some instances) host bus adapters, associated with three or more disks. A system may be located outside of or within a server cabinet and the average cost of the disk storage systems does not include infrastructure storage hardware (i.e. switches) and non-bundled storage software.

The information in this quantitative study is based on a branded view of the disk storage systems sale. Revenue associated with the products to the end user is attributed to the seller (brand) of the product, not the manufacturer. Original equipment manufacturer (OEM) sales are not included in this study. In this study, Hitachi Data Systems (HDS) sales do not reflect their OEM sales to Sun Microsystems and Hewlett-Packard.

IDC's Worldwide Disk Storage Systems Quarterly Tracker is a quantitative tool for analyzing the global disk storage market on a quarterly basis. The Tracker includes quarterly shipments and revenues (both customer and factory), Terabytes, $/Gigabyte, Gigabyte/Unit, and Average Selling Value. Each criteria can be segmented by location, installation base, operating system, vendor, family, model, and region.

For more information about IDC's Worldwide Disk Storage Systems Quarterly Tracker, please contact Hoang Nguyen at 508-935-4718 or hnguyen@idc.com.

About IDC

IDC is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. IDC helps IT professionals, business executives, and the investment community make fact-based decisions on technology purchases and business strategy. More than 1,000 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends in over 100 countries. For more than 44 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. You can learn more about IDC by visiting www.idc.com.

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