Worldwide Disk Storage Market Posts Solid Gains in the Fourth Quarter and for 2006, According to IDC

FRAMINGHAM, MA – MARCH 12, 2007 – Worldwide external disk storage systems factory revenues grew $272 million in the fourth quarter of 2006 (4Q06), posting 6.0% growth from a year ago to $4.8 billion, according to IDC Worldwide Disk Storage Systems Quarterly Tracker. For the quarter, the total disk storage systems market grew to $6.9 billion up 4.9% from the prior year's fourth quarter. Total disk storage systems capacity shipped reach 1,030 petabytes, growing 48.5%.

"The adoption of networked storage continues to fuel the market," said Brad Nisbet, program manager with IDC's Storage Systems Program. "In particular, we saw strong results for NAS which is indicative of ongoing interest in file-related storage. In addition, iSCSI continues to emerge as an alternative connection type for many customers as they look to simplify the environment for less mission-critical applications."

Total External Disk Storage Systems

For the fourth quarter, EMC maintained its lead in the external disk storage systems market with 22.1% revenue share, followed by IBM and HP with 18.6% and 13.7% revenue share, respectively. Dell and Hitachi rounded out the top 5 with 8.1% and 7.3%, respectively. Among the top 5 suppliers, IBM and EMC posted the strongest year-over-year revenue growth during 4Q06, with 15.5% and 10.0% growth, respectively.

Network Disk Storage Systems

The total network disk storage market (NAS Combined with Open SAN) posted 12.7% year-over-year growth in the fourth quarter to more than $3.3 billion. EMC continues to maintain its leadership in the total network storage market with 28.7% revenue share, followed by IBM and HP with 16.6% and 13.3% revenue share, respectively.

In the Open SAN market, which grew 10.5% year over year, EMC lead with 25.3% revenue share, followed by IBM with 18.9%. The NAS market grew 21.9% year over year, led by EMC with 41.2% revenue share and followed by Network Appliance with 24.3% share. The iSCSI SAN market continues to show strong momentum, posting 78.9% revenue growth compared to the prior year's quarter. Network Appliance continues to lead the market with 23.0% share, followed by EMC with 18.2% share.

"The market for network storage systems priced between $15,000 and $149,999 remained a sweet spot for vendors in 2006," said Natalya Yezhkova, research manager with IDC's Storage Systems Program. "These products grew at a double-digit rate and, for the first time, outsold the higher-priced segment (systems priced $150,000 and over) during all four quarters. Several factors contributed to this dynamic, including the increased adoption of network storage by mid-sized businesses and the growing demand for less expensive, capacity-oriented storage aimed at more non-transactional applications such as digital content, email archives and replicated data."

Top 5 Vendors, Worldwide External Disk Storage Systems Factory

Revenue, Fourth Quarter of 2006

(Revenues are in Millions)

Vendor 4Q06 Revenue Market Share 4Q05 Revenue Market Share 4Q06/4Q05 Revenue Growth

EMC $1,059 22.1% $962 21.3% 10.0%

IMB $892 18.6% $772 17.1% 15.5%

HP $658 13.7% $680 15.0% -3.2%

Dell $390 8.1% $428 9.5% -8.8%

Hitachi $348 7.3% $340 7.5% 2.3%

Others $1,449 30.2% $1,341 29.6% 8.0%

All Vendors $4,796 100.0% $4,524 100.0% 6.0%

Source: IDC Worldwide Quarterly Disk Storage Tracker, March 2007

Total Disk Storage Systems Market

In the total worldwide disk storage systems market, IBM lead the market with 24.1% followed by HP with 19.7% revenue share respectively. EMC maintained the third position with 15.3% revenue share.

Top 5 Vendors, Worldwide Total Disk Storage Systems Factory Revenue,

Fourth Quarter of 2006

(Revenues are in Millions)

Vendor 4Q06 Revenue Market Share 4Q05 Revenue Market Share 4Q06/4Q05 Revenue Growth

IBM $1,668 24.1% $1,529 23.1% 9.1%

HP $1,366 19.7% $1,405 21.3% -2.8%

EMC $1,059 15.3% $962 14.6% 10.0%

Dell $595 8.6% $611 9.2% -2.5%

Sun Microsystem $364 5.3% $313 4.7% 16.3%

Hitachi $356 5.1% $348 5.3% 2.4%

Others $1,517 21.9% $1,438 21.8% 5.5%

All Vendors $6,926 100.0% $6,605 100.0% 4.9%

Source: IDC Worldwide Quarterly Disk Storage Tracker, March 2007

Full Year Results for Disk Storage Systems Market

For the full year, the external disk storage market grew 8.0% to $17.0 billion in revenues. EMC maintained its lead in the external disk storage systems market with 21.9% revenue share, followed by IBM and HP in a statistical tie for the second position with 15.1% and 14.3% revenue share, respectively. Dell and Hitachi rounded out the top 5 in statistical tie with 8.3% and 8.0%, respectively. Among the top 5 suppliers, EMC and IBM posted the strongest year-over-year revenue growth during 2006, with 10.8% and 10.5% growth, respectively.

For the full year, the total disk storage systems market posted 6.0% growth to $24.4 billion. In the total worldwide disk storage systems market, IBM and HP lead the market in statistical tie with 21.0% and 20.5% revenue share, respectively. EMC maintained the third position with 15.2% revenue share. EMC and IBM posted the largest year-over-year revenue growth among the top 5 vendors during the quarter, with 10.8% and 5.0% growth respectively.

Top 5 Vendors, Worldwide External Disk Storage Systems Factory

Revenue, Full Year 2006

(Revenues are in Millions)

Vendor 2006 Revenue Market Share 2005 Revenue Market Share 2006/2005 Revenue Growth

EMC $3,727 21.9% $3,363 21.3% 10.8%