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Worldwide Enterprise Storage Market Sees Modest Decline in Third Quarter, According to IDC

Total worldwide enterprise storage systems factory revenue was down 3.2% year over year and reached $8.8 billion in the third quarter of 2016 (3Q16), according to the International Data Corporation (IDC) Worldwide Quarterly Enterprise Storage Systems Tracker. Total capacity shipments were up 33.2% year over year to 44.3 exabytes during the quarter. Revenue growth increased within the group of original design manufacturers (ODMs) that sell directly to hyperscale datacenters. This portion of the market was up 5.7% year over year to $1.3 billion. Sales of server-based storage were relatively flat, at -0.5% during the quarter and accounted for $2.1 billion in revenue. External storage systems remained the largest market segment, but the $5.4 billion in sales represented a decline of 6.1% year over year.

"The enterprise storage market closed out the third quarter on a slight downturn, while continuing to adhere to familiar trends," said Liz Conner, research manager, Storage Systems. "Spending on traditional external arrays resumed its decline and spending on all-flash deployments continued to see good growth and helped to drive the overall market. Meanwhile the very nature of the hyperscale business leads to heavy fluctuations within the market segment, posting solid growth in 3Q16."

3Q16 Total Enterprise Storage Systems Market Results, by Vendor Group

Dell Technologies held the number 1 position within the total worldwide enterprise storage systems market, accounting for 25.5% of spending. HPE held the next position with a 15.5% share of revenue during the quarter. NetApp, IBM, and Hitachi finished in a statistical tie* for the third position, capturing 6.6%, 5.9% and 5.7% of global spending, respectively. As a single group, storage systems sales by original design manufacturers (ODMs) selling directly to hyperscale datacenter customers accounted for 15.0% of global spending during the quarter.

Top 5 Vendor Groups, Worldwide Total Enterprise Storage Systems Market, Third Quarter of 2016 (Revenues are in US$ millions)

                     

3Q16/3Q15

3Q16

3Q16 Market

3Q15

3Q15 Market

Revenue

Vendor Group      

Revenue

   

Share

   

Revenue

   

Share

   

Growth

1. Dell Technologies       $2,250.6     25.5%     $2,574.5     28.2%     -12.6%
2. HPE       $1,368.0     15.5%     $1,488.6     16.3%     -8.1%
T3. NetApp*       $587.1     6.6%     $651.0     7.1%     -9.8%
T3. IBM*       $518.1     5.9%     $584.6     6.4%     -11.4%
T3. Hitachi*       $502.4     5.7%     $459.8     5.0%     9.2%
ODM Direct       $1,323.0     15.0%     $1,252.1     13.7%     5.7%
Others       $2,283.5     25.9%     $2,115.1     23.2%     8.0%
All Vendors       $8,832.7     100.0%     $9,125.7     100.0%     -3.2%
Source: IDC Worldwide Quarterly Enterprise Storage Systems Tracker, December 2, 2016

Notes:
* IDC declares a statistical tie in the worldwide enterprise storage systems market when there is less than one percent difference in the revenue share of two or more vendors.
Dell Technologies represents the combined revenues for Dell and EMC.

In addition to the table above, an interactive graphic showing the worldwide market share of the top 5 total enterprise storage systems vendor group plus ODM Direct sales over the previous five quarters is available here. Instructions on how to embed this graphic into online news articles and social media can be found by viewing this press release on IDC.com.

3Q16 External Enterprise Storage Systems Results, by Vendor Group

Dell Technologies was the largest external enterprise storage systems supplier during the quarter, accounting for 31.6% of worldwide revenues. NetApp and HPE finished in a statistical tie* for the number 2 position with 10.9% and 10.2% of market share, respectively. Hitachi and IBM rounded out the top 5 in a statistical tie* for the number 4 position with revenue shares of 9.1% and 8.6%, respectively.

Top 5 Vendors Groups, Worldwide External Enterprise Storage Systems Market, Third Quarter of 2016 (Revenues are in Millions)
                     

3Q16/3Q15

3Q16

3Q16 Market

3Q15

3Q15 Market

Revenue

Vendor Groups      

Revenue

   

Share

   

Revenue

   

Share

   

Growth

1. Dell Technologies       $1,708.2     31.6%     $2,057.3     35.8%     -17.0%
T2. NetApp*       $587.1     10.9%     $651.0     11.3%     -9.8%
T2. HPE*       $549.0     10.2%     $598.4     10.4%     -8.2%
T4. Hitachi*       $493.4     9.1%     $451.2     7.8%     9.4%
T4. IBM*       $463.5     8.6%     $533.8     9.3%     -13.2%
Others       $1,597.6     29.6%     $1,460.0     25.4%     9.4%
All Vendors       $5,398.9     100.0%     $5,751.8     100.0%     -6.1%
Source: IDC Worldwide Quarterly Enterprise Storage Systems Tracker, December 2, 2016

Notes:
* IDC declares a statistical tie in the worldwide enterprise storage systems market when there is less than one percent difference in the revenue share of two or more vendors.
Dell Technologies represents the combined revenues for Dell and EMC.

Flash-Based Storage Systems Highlights

The total All Flash Array (AFA) market generated over $1.1 billion in revenue during the quarter, up 61.0% year over year. The Hybrid Flash Array (HFA) segment of the market continues to be a significant part of the overall market with $2.1 billion in revenue and 24.1% market share.

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 Lidice Fernandez at 305-351-3051 or [email protected].

About IDC
International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly-owned subsidiary of International Data Group (IDG), the world's leading media, data and marketing services company. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC.

All product and company names may be trademarks or registered trademarks of their respective holders.

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