Infinidat is a modern, growing storage systems supplier with very interesting high-performance products. A private company head-quartered in Herzliya, Israel with its US business based in Waltham, MA., it was founded by Moshe Yanai in 2011 – a key inventor of storage products at EMC and XIV (an object storage supplier acquired by IBM in 2008). Read more »
Storage capacity shipments fall – the end of exponential growth?
Part of the sofftness of the ITC market I’ve pointed to before is due to a fall in the shipped capacity of storage. I wanted to share some of the advanced research I conduct to highlight this area. My Figure above shows the quarterly shipped capacity of the three most important types of raw storage device.
Cisco to acquire Splunk for $28 billion
Last week Cisco announced its intention to acquire Splunk for $157/share, equalling around $28 billion. If it goes ahead it will be Cisco’s largest. Splunk’s total revenues have grown to be roughly the same as Cisco’s security sales (my Figure above). One difference is that Splunk’s business is moving rapidly towards a cloud subscription model (see later); in comparison Cisco’s is dominated by network hardware sales. Read more »
Q2 2023 ITC spending – declines in memory and devices, growth in AI hardware
In the second quarter of 2023 there was a 3% growth in ITC spending to $1.855 trillion and a 10% growth in the total net profit of all vendors to $275 billion (see my précis in the Figure above); however, on an annual basis spending was flat at $7.155 trillion and profits were down 13% at $960 billion. The softness I reported last quarter remains, with a significant downturn in memory (HDD, DRAM and NAND) and devices. As a counterbalance there is a strong investment in general AI by public clouds. I want to share my findings with you and welcome any questions you might have as a result. Read more »
The gaming market – a cloudy future?
The gaming market is founded on proprietary console platforms from three suppliers – Sony (Playstation), Nintendo (Switch) and Microsoft (Xbox). Other software vendors, such as Activision Blizzard and Electronic Arts, address these platforms only once through being licensed to do so by one of the three suppliers (see my Figure above for their revenue trends, showing the sum of their four quarter sales at the end of each quarter since Q1 2014). Read more »
IBM Storage introduces the Flash System 5045
IBM announced last updated its FS5000 series storage systems in February 2021, having launched them the year before. This week it announced the FS5045, which replaces the FS5035. Like the FS5035, the new product includes
- Data reduction (compression and deduplication),
- Scale-out clustering,
- IBM HyperSwap high-availability and
- Encryption
To differentiate it from the cheaper FS5015, giving it the same enhanced data resilience capabilities available on the higher-end IBM Flash System 5200, 7300, and 9500 models. Like the FS5015, the FS5045 comes complete with a licence to use IBM Spectrum Virtualize for help storage use in multi-cloud environments.
Hardware specifications for the FS5045 include:
- Maximum bandwidth: 12.4 GB/second (v 8GB/second for the FS5015)
- Maximum latency: 70μs
- IOPS: 1.2m
- Processor: Intel Broadwell DE (6 core)
- Disk configuration: SAS SSD, or mixed SAS SSD + HDD
- Maximum disk capacity: 550TB
IBM also announced that the FS5015 and FS5045 can now be covered in its Expert Care Basic and Advanced service contracts. It cut its list prices for its storage systems worldwide by 15% on April 20th this year. This seems sensible given the crashing prices on NAND devices I highlighted in my last post. This is clearly a time for enterprise customers to increase the capacity of raw storage in the arrays they use.
Softness in client device and raw storage sales creates challenges for IT spending in 2023
The IT market is going through a downturn and I wanted to try to explain where this softness comes from and what it means for sales in the rest of 2023. Read more »
IBM’s new single-frame z16 includes its first rack-mount mainframe offering
One of the mainframe’s last physical definition has been broken with IBM’s introduction of its new rack-mounted z16 product, since for the first time its range now includes a product that isn’t sold encased in a ‘frame’[1]. Read more »
Cloud computing grows up – $413 billion and counting…
Cloud computing has been one of the fastest growing and exciting IT markets over the past decade. Typically bought by enterprises wanting to avoid the complexity of setting up, deploying and managing applications them in their own data centers, cloud services come in three flavours – software, platform and infrastructure – to which we attach the phrase ‘as a Service’ to create the sub-markets of SaaS, PaaS and IaaS. In this post I’ll look at their growth from a regional and vendor angle and put cloud spending in context with other areas of the enterprise IT market. Read more »
Networking – converged, converging or eternally independent?
I’ve been working in the IT and Communications markets for almost 40 years and throughout this period there has been a constant debate around the convergence of these two industries. The arrival of Private 5G brings convergence back as a major issue as IT servers, storage and software are being used in the core, edge and access network – areas that in previous generations were the preserve of the service provider network suppliers. Read more »
Storage systems – sales steady, but uncoupled from raw storage growth
Storage systems are vital to the IT industry. In 2022 spending grew by 2.2% to reach $37.9 billion, shipments, by 0.5% to 1.2 million, while the installed based reached 4.1 million – 2.9% up on 2021. In this post I’ll look at the market movements with comparisons to the development of HDD, NAND and DRAM. Read more »
Dell heads the slowly evolving server market in 2022
The server market grew by 6.8% to reach $97 billion in 2022; unit shipments were up 5.4% at 29 million and the installed base grew by 2.0% to reach 87 million at the end of the year. In this post I’ll review what happened, why and what that means for the future. Read more »
The Apple king of mobile devices
Mobile devices, in my research, include basic and smart phones, (non-PC) tablets, audio and wearable devices. For the most part their processing is done by ARM chips. They allow us to take computing on the road and form one of the largest and most innovative sub-section of the overall IT market. In this post I’ll look at the shape of the market over the last few years by form factor, region and supplier and share my forecast for coming years. Read more »
Will the post-pandemic peripherals market recover?
The market for IT peripherals covers printers, supplies, digital cameras, mice, replacement keyboards and like products. It is dominated by printer suppliers who own the patents, manufacturing capabilities and patience to build financially-sustainable models in which consumers and enterprises purchase an initial product and then spend incrementally on supplies – such as paper, printer and toner cartridges – to keep them running. The COVID-19 pandemic slowed the printer market dramatically – office employees working from home have little need for print-outs. Although it was also a boon for suppliers of PC add-ons (keyboards, mice, mobile speakers, etc.) such as Logitech, the market has seen a multi-year decline. In this post I’ll look at whether (and how) peripherals vendors can create a positive market momentum in the coming years. Read more »
Dire times ahead for the PC market
The PC market was stalled by the pandemic in 2020, grew dramatically in 2021 and began to shrink in 2022, when supplier revenues began to fall. 2023 is going to be another difficult year due to market saturation in many wealthy countries and a focus of suppliers on newer IoT-based devices steal spending away from this product area. In this post I look at what happened in the last year. Read more »
2023 ITC predictions – give Peace a chance!
Welcome to my predictions for the ITC market in 2023. It follows my self-assessment of last year’s set, which I believe would have been more accurate if Russia hadn’t decided to invade the Ukraine. The war will continue – possibly throughout 2023 – making this year just as difficult to predict; strategic planning will become even more difficult if China decides to attack Taiwan, or North strikes out at South Korea.
In 2023 we will also still be dealing with the consequences of the pandemic, which started in 2020. The supply chain problems we suffered then were replaced by strong growth in the hardware markets, which have now leveled out, while the under-immunized Chinese population spreads new serious consequences at home and abroad.
In 2023 I’m expecting a rebound in component markets – especially in disk drives, NAND and DRAM, where new higher capacities will come on stream, fuelling a growth in ITC hardware in 2024. For the time being inflation, national currency declines against the $US in EMEA and sluggish or declining GDP will make many eke out the life cycles of their installed PCs, smartphones, servers and storage systems.
The conclusion of recent COP27 climate talks in Egypt show that the world’s major polluters are still avoiding the major steps needed to prevent continuing crises. The ITC industry is capable of being part of the solution through minimizing waste and virtualizing business and social interactions; however things won’t start to get better before the world moves away from electricity generation from fossil fuels, especially coal. On a smaller scale the smelting of iron from electricity, as opposed to coke, would help direct us towards a more sustainable future.
My predictions for the coming year are:
- The world IT market grows just 1% – Asia Pacific best (+4%), the Americas alright (+2%), but EMEA declines by 2%
- Revenue growth in software and IT services outstrips that in hardware and telecoms services in 2023
- ITC spending in China continues to decline
- Cloud computing spending reaches its zenith in 2023
- ‘Hybrid cloud’ turns from a generic description to a number of tried and tested blueprints
- IoT devices outstrip PC and smartphone shipments in 2023
- Raw storage returns to growth in 2023
- IT, OT and CT are mixing like ever before, but not converging
- War unsettles the global market – affects factory locations, suppliers and alliances
- 2023 – give peace a chance!
ITCandor 2022 predictions – a self-assessment
Before publishing my predictions for 2023, it’s time to appraise those made for this year – which covered most of the third year of the pandemic. As always, I’ve marked each between 1 and 10 based on their accuracy.
| No. | My top 10 predictions | Score | Comment |
| 1 | The total ITC market grows by 4% to reach $7.6 trillion; net profit, by 9% to $1.3 trillion | 4 | The total market looks like growing by 1% to $7.1 trillion, but profits will decline by 14% to $978 billion |
| 2 | Spending in the Americas grows 8%, Asia Pacific 6% and EMEA 2% | 6 | The Americas will grow by 9%, but asia Pacific will be down 3% and EMEA, down 4% |
| 3 | Spending on software grows 7%, IT service and hardware by 5% each, while spending on telecom service stays level | 6 | Software will grow by 4%, IT Service by 6%, but hardware growth was zero and telecom service was down 7% |
| 4 | Cloud spending growth flattens – SaaS will be (just!) 18%, IaaS 13% and PaaS 13%; in total these offerings account for $430b | 7 | Cloud growth flattened; SaaS will grown 12%, IaaS and PaaS by 9% each; the total will be $402b |
| 5 | Global supply chain problems continue, extending hardware life cycles and second-hand sales | 10 | Yes – the sluggishness of hardware sales shows customers are keeping their products longer |
| 6 | American suppliers increase their combined global ITC market share to over 50% | 10 | Yes – I calculate that their share will be 57% in 2022 |
| 7 | ‘as a service’ offerings and hybrid multi-cloud architectures become the norm in enterprise computing | 8 | The focus on Digital Transformation, accelerated by the pandemic, makes this de rigor for large organizations (at least) |
| 8 | Government counter-measures fight back against cyber crime | 6 | The war between Russia and the Ukraine has increased cyber security measures, but only a few countries have jailed too few hackers |
| 9 | Raw storage shipped capacity exceeds 4 Zetabytes in 2022 | 2 | Capacity has fallen to 2 Zetabytes as hardware markets stalled |
| 10 | ITC will be more of a solution to, than the cause of, the challenges of a difficult year | 8 | Yes – video calling and the growth of IoT enabled consumer hardware has made upm for higher prices |
At 67% accuracy this was another poor year for my forecasts; I can perhaps excuse myself by noting that the ‘territorial conflicts between Russia and the Ukraine’ mentioned at the beginning of last year’s predictions escalated into a full-scale invasion.
IBM launches Diamondback – an open automated tape library in search of new customers
Today IBM launched its Diamondback automated tape system. It joins the TS4500 as a resource for backing up, archiving and protecting massive amounts of data. The advantages of these systems include:
- Cyber Resilience – by creating an air gap between the backed-up and active data – un-mounted tapes can’t be accessed directly by hackers. Write Once Read Many (WORM) technology used in tape drives prevents the overwriting or erasure of data.
- Environmental Sustainability – un-mounted tapes use zero electricity. Although they use motors for selecting and mounting tapes to retrieve their data, there are major savings to be made against storage systems in which all disk and solid state drives draw electricity all the time,
- Reduced Costs – tape capacity is significantly cheaper per terabyte than either disk and solid state storage.
- These are both tape-based systems, unlike IBM’s TS7700 virtual tape library, which uses a combination of disk and tape.
The profitability of chip suppliers
There’s been some discussion of the profitability of the microprocessor market in the press in the last week, so I wanted to share some of my research to add to the debate. My Figure above shows the profitability (net profit/revenues) of the suppliers in the microprocessor market. I’ve chosen to show this on a rolling 4 quarter basis (i.e. the 4 trailing quarters are shown in each value). Read more »
IBM integrates Red Hat ODF and Ceph into its storage division
IBM acquired Red Hat in 2018. Since then Red Hat has operated as a semi-autonomous company with IBM using its expertise to enhance its own software developments and its OpenShift management software as a pivotal part of its hybrid multi-cloud strategy. Read more »