Disk drive shipment numbers take a dive

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July 11, 2023

Preliminary hard disk drive shipment numbers for the second 2023 quarter are down, according to TrendFocus, with Toshiba losing market share to Seagate and Western Digital.

The research house sends its numbers to paying subscribers and some, such as Wells Fargo, pass them on in turn to their subscribers and contacts. The figures should be taken with a pinch of salt, but TrendFocus says there were between 30.8 million to 32.2 million disk drives shipped in the quarter compared to 38.6 million shipped a year ago, a 20.2 percent drop. There was a 33.5 percent fall from Q1 2022 to Q1 2023..

TrendFocus splits its total three ways into nearline (3.5-inch), desktop and consumer electronics in 3.5-inch and 2.5-inch formats, and then adds the numbers up by supplier. Aaron Rakers from Wells Fargo says there were about 9.5 million nearline (3.5-inch high capacity) drives shipped in the quarter, with about 136EB of capacity. This is down roughly 45 percent Y/Y, way more than the 30.5 percent decline in 4Q 2022 and the 27 percent slump in the first 2023 quarter.

Will the nearline exabytes shipped number recover? Rakers’ chart shows that here hasn’t been a slump like this in the past, but the suppliers, quoting IDC data storage growth trends, are convinced that demand will return and nearline exabytes shipped will resume growth.

They expect that disk drive units and exabytes shipped outside the nearline sector will both probably decrease as SSDs take market share. Total non-nearline ships in the quarter were about 22 million, down a little from the 22.1 million in Q1 and 17 percent down from the 26.2 million shipped a year ago.

There were between 11.5 and 11.9 million 3.5-inch desktop and consumer electronics (CE) drives shipped, compared to 11.07 million shipped in the first quarter and 14.23 million shipped a year ago. Just under 9 million 2.5-inch mobile and CE HDDs shipped in the quarter, down from the from the 9.64 million that went out from the suppliers’ factories in Q1 and 9.97 million a year ago.

We don’t have numbers for the mission-critical 2.5-inch 10K drive sector. This has been particularly sensitive to SSD replacement.

We are into the third or fourth year of general SSD cannibalization and still see more desktop and CE drives shipped than enterprise nearline drives – the HDD market most resistant to SSD replacement. HDD shipments have very long tails. Even the notebook form factor 2.5-inch disk drives are still shipping nearly 9 million a quarter, with many of them going into small form-factor desktop PCs.

The supplier unit ship totals are not being supplied but Rakers does give us approximate percentage shares. We’ve rounded them up to give Seagate 44.5 percent, Western Digital 38 percent, and Toshiba 17.5 percent.

Estimated disk drive shipments — *The 2023 numbers are in italics because they are preliminary estimates*

We’ve tabulated them over time to get a picture of share changes:

We can see Seagate has maintained a unit ship lead over Western Digital and both have gained share from Toshiba over the last two quarters, Western Digital particularly. Toshiba shipped, we calculate, about 5.4 million drives. It needs to keep up with the other two suppliers, capacity-wise, or risks falling further behind.

ExaGrid claims it’s heading towards 4,000 customers

By

Chris Mellor

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July 11, 2023

Purpose-built backup appliance (PBBA) vendor ExaGrid had claimed a record-breaking second quarter, saying its customer numbers are heading to 4,000 and that it pulled in $19 million from new clients.

Update: ExaGrid new customer revenue number updated. July 12, 2023.

The privately held company did not provide profit and loss figures.

ExaGrid’s PBBA tiered storage products store incoming backup data in a so-called Landing Zone for fast restoration closely following backup, and then deduplicates the backup data for longer term storage in the device. Competing PBBAs dedupe on backup ingest, lengthening ingest time and making rehydration (reversing deduplication) necessary for all restore jobs.

CEO and president Bill Andrews said: “ExaGrid is continuing to expand its reach and now has sales teams in more than 30 countries worldwide and customer installations in over 80 countries. We will hit 4,000 active customer installations in Q3. We have achieved our top-line goals for Q1 and Q2. ExaGrid is cash, P&L, and EBITDA positive for the 10th quarter in a row. Outside of the United States, our business in Canada, Latin America, Europe, the Middle East, Africa, and Asia Pacific is rapidly growing and is now 45 percent of the business.”

ExaGrid revenues grew 27 percent Y/Y and there were 135 new customers with an ASP rising to $119,000. There were 50 six and seven-figure deals. The total customer count went past 3,900. The company has a 95 percent net customer retention rate, with 99.1 percent of customers on yearly maintenance and support, and 94 percent having its Retention Time-Lock for Ransomware Recovery feature (immutability) turned on. The company has an NPS score of +81.

*Blocks & Files chart using ExaGrid numbers*

We calculated it pulled in $16 million from new customers, multiplying the new customer number, 135, against the ASP of $119,00. But CEO BIll Adrews subsequently told us: “The actual new customer bookings number, in the quarter, was just over $19million.”

Competition

In the PBBA market ExaGrid competes with Dell EMC’s PowerProtect, HPE’s StoreOnce, Quantum’s DXi and Veritas’s NetBackup Flex product. We don’t know the specific sales figures for Dell EMC, HPE or Veritas’ products. That makes comparing sales of difficult.

Update: Quantum earned revenues of $46 million from sales of its ActiveScale (object storage), DXi, and Scalar tape systems in the first calendar 2023 quarter. The proportion of DXi sales is not known. Quantum did say it had an incredible year of hyperscale sales, meaning tape, with 2x revenue growth Y/Y. Splitting the $46 million three ways with Scalar tape taking the largest share gives an indication of possible DXi revenues. Ignoring that, an equal third share would give DXi $15.33 million revenues in the quarter.

With ExaGrid earning $19 million from new customers plus whatever it made from its existing customers we think it highly likely ExaGrid outsold Quantum’s DXi products in its second 2023 quarter. Bill Andrews told us: “We crossed the $100M million [run rate] 2 years ago. Our existing repeat order business in the quarter was higher than the new logo business.”

That means ExaGrid pulled in at least $38 million in the quarter, indicating a minimum $152 million run rate. Our thinking, after talking with Andrews, is that the suppliers in ExaGrid’s market are ranked (1) Dell EMC and a long way behind, (2) Veritas FlexScale appliance – for Veritas NetBackup only, and HPE StoreOnce may be #3 or ExaGrid may be #3; it is really close. Quantum with DXi trails some way behind.

Competition also comes from all-flash array suppliers like Pure Storage (FlashBlade) and VAST Data offering fast restore from QLC flash-based systems with claimed disk-level TCO. As backups tend to be large, restore speed is more affected by bandwidth than latency and ExaGrid’s ability to restore from a non-deduped landing zone could nullify any SSD speed advantage over disk.

We note that ExaGrid could use QLC flash media as well in future products.

Another competitive trend is the use of direct-to-object storage backups with Veeam v12 sending data to ObjectFirst, Pure Storage, VAST Data, Cloudian, MinIO, Scality and Zadara as an example.

We understand that ExaGrid could add an S3 interface and join in as well.

Seagate inks sale and leaseback deal for Colorado campus

By

Chris Mellor

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July 10, 2023

Seagate is selling and then leasing back its Longmont, CO, campus for $101.5 million.

The hard disk drive maker opened up in Longmont in 1999 and has a research and development facility there. The campus consists of 40.65 acres of land with a 529,437 sq ft facility at 389 Disc Drive. Mile High says there are 950 employees on site and it features 137,000 square feet of lab space, 10,000 square feet of Class 10 cleanroom, Class A office, a fitness center and a full-service cafeteria. Seagate said it was looking for a sale and leaseback deal last November. At that point, Seagate’s first fiscal 2023 quarter, its revenues had fallen 35 percent Y/Y to $2.04 billion and it wanted to cut its costs and free up capital.

The property was listed for sale in May and has been acquired by private equity business Conscience Bay Co. Greg Belloni, Seagate’s senior manager of corporate communications, told the Longmont Leader that the deal provided “capital for reinvestment into our business, strengthening our balance sheet, and increasing focus on our core competencies to drive growth. We are pleased to confirm the completion of the sale and leaseback transaction.”

Since November Seagate’s quarterly revenues have fallen again, to $1.89 billion in its Q2, with a loss of $33 million, and then to $1.86 billion in Q3, with a loss of $433 million, strengthening the need to obtain cash. It started a layoff round to cut its costs further and set out to raise $1 billion in a private bond placement to pay off debt.

The disk drive market is in a multi-quarter slump and Seagate is introducing its higher density HAMR disk drives after a long and no doubt costly development process. It is also building up its Lyve Drive cloud storage and disk transfer business. Despite its revenue decline it has managed to gain market share in the second calendar 2023 quarter, according to preliminary estimates from research house TrendFocus.

Seagate took around 44.5 percent of the HDD market by revenue, up 1.3 to 1.8 percent Q/Q, with Western Digital accounting for about 38 percent, down around 0.3 percent Q/Q. Third player Toshiba took about 17.5 percent of the market, down between 1.3 and 1.8 percent.

Seagate is leasing the Longmont facility for 10 years with two five-year renewal options, and has received a cash boost of $101.5 million. Hopefully its 33TB HAMR drives will be well received and enable it to continue to gain market share as the HDD recession ends. That is dependent on Pure Storage’s claim of disk drive shipment death by 2029 not coming true, of course.

Unsure about your generative AI plans? Start with your data

By

Nick Brackney, Dell Technologies

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July 10, 2023

Commissioned: Call it an overnight success years in the making. Generative AI (GenAI) has exploded on the scene as one of the most critical areas organizations need to invest in. Decades of AI innovation paired with a natural language interface created the magic that has captured our collective attention. This is a wave for the ages. In oceanography there’s a term for these rare and unusually large phenomena: “rogue wave,” an outlier where the height is greater than twice the significant wave height. It’s an apt term for what we’re seeing with GenAI, and the challenge with these waves is they often materialize out of nowhere. Who had GenAI as the most important investment opportunity for CIOs in 2023 on their bingo card?

Catching the wave versus being caught under it

A boat can float on the water; it can also sink in it. Technology leaders everywhere, as captains of their respective boats, are rushing to stay ahead of this potentially crushing wave. The challenge is where to start? A decade ago, IT leaders worried about shadow IT projects springing up outside of governance; today they have a new concern: shadow AI.

At the same time, they’re also seeing opportunities. Forward looking and agile organizations are eagerly piloting GenAI solutions, often in the software development space where things like GitHub Copilot have really captured the mindshare of developers. What’s interesting is that while 70 percent of developers surveyed by Stack Overflow say they are already using or plan to use GenAI in coding, only 42 percent trust the accuracy of the output in their tools. This tells us we’re still relatively early in the GenAI cycle, but the rate of acceleration might keep some leaders up at night.

While there’s a broader conversation to be had on developing a winning GenAI strategy and who should be leading the charge, today we’ll focus on the role data will play and why it’s critical to your AI strategy. The good news? You can take steps to address it now.

Data’s value is only increasing with GenAI

As organizations become increasingly digital, every activity in their business is effectively exhausting data. Now not all data is equal; some data is inherently more valuable. For example, data that’s proprietary or hard to acquire, private or confidential data and, of course, data that’s useful to the business. This is where it gets tricky, though, because today very little of this data is meaningfully used. For instance, only 26 percent of ITDMs say all innovation efforts are based on data insights. This is because historically the volume of data has greatly surpassed our ability to analyze it.

Enter GenAI. Now imagine for a second that same corpus of data can be parsed with AI in minutes, if not seconds (depending on how much power you’re putting behind it). Suddenly, the long tail of data which was previously incomprehensible, has now been unlocked. This puts us in a quandary because existing logic on data retention and the understanding of how data can be used, or even its useful longevity, has now completely changed.

Getting your data house in order

As you start your GenAI journey, you must start first by getting your data house in order. Because you might not know what questions to ask your data today, but at some point you will – and if you haven’t retained that data, those answers will always elude you. You can begin building the strategy and experimenting, but getting a handle on your data now is key. With that in mind, here are four areas to consider:

• Collection: digital end points or data creation areas are currently generating data? Are they connected? Is the data just living on an edge device somewhere never being utilized?

• Curation: Do you have a way to tag and classify data so its value and usage restrictions are known? Do you know who would benefit from having access to this data, and have you also appropriately applied labeling to understand privacy, governance, and intellectual property protections?

• Storage: Is there a process for centralizing this data and ensuring access? Have you looked into connecting different IT environments, potentially clouds? Have you established an effective data tiering strategy to align with the data’s value and lifecycle?

• Protection: Can you protect against a data loss or ransomware event? Can you ensure you’re meeting your governance and data sovereignty requirements? Do you understand the risks with various data and have you built an approach to mitigate them and secure access?

Walk before you run

I know it’s an incredibly exciting time and the way GenAI has captured our mindset has been very consumer oriented. There’s a lot of work for IT to do to catch up. In many ways it’s like in the “bring your own device” wave of innovation; it was very easy for consumers to move quickly. There’s no existing legacy infrastructure or data to consider; simply buy a smartphone and you’re up and running. But as we saw in that time period, the backend requirements to enable work from anywhere in a secure manner took years to catch up. Avoid the temptation to barrel right into something without first setting the stage for your success. While you build the strategy for the next decade, be sure to triage your existing environment as well.

Learn more about our Dell APEX portfolio of as-a-service offerings and how Project Helix helps organizations leverage generative AI to drive emerging use cases and deliver value.

Brought to you by Dell Technologies.

Storage news ticker – July 10

By

Chris Mellor

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July 10, 2023

Apple’s coming iPhone 15 could have a memory range of 256GB, 512GB and 1TB, eliminating the 128GB entry point of the iPhone 14, according to Wells Fargo analyst Aaron rakers.

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Data protector CrashPlan has signed a distribution agreement with Ingram Micro’s Emerging Business Group (EBG) to distribute its cloud backup offerings to Ingram Micro’s US channel partner network.

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A few years ago DataCore sold a vFilo product that used Hammerspace file technology. No more. A Hammerspace spokesperson said: “DataCore is no longer an OEM of Hammerspace for net new opportunities. We are still working together to jointly support existing customers. The relationship has evolved to a referral partnership where we each sell and support our respective technology.”

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The second gen Dell PowerMax used storage class memory for metadata. It possibly did this to avoid the penalty of increasing battery requirement to support the memory-based vaulting architecture inherited from EMC Symmetrix and VMAX. When Intel nixed Optane, VAST Data pivoted to using Kioxia’s FL6 as an Optane SCM alternative.

A storage industry contact suggested that a future PowerMax could use CXL-connected shared memory between its controllers to speed data IO and this would require substantial battery backup to protect against power failure.

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Hornet Security, which also provides backup, has published a Backup Bible. It has 150 pages discussing how to prepare for, respond to, and recover from a substantial data loss event. It contains instructions and examples for building and maintaining a thorough data protection system, and includes customizable templates enabling business owners to create their own personalized backup strategy. Get it here.

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Dun & Bradstreet is using Ocient’s Hyperscale Data Warehouse as a Service on Google Cloud. D&B is projecting $3.4 million in cost savings over five years and ROI achieved within 10 months. It is experiencing 96.3 percent lower elapsed processing time and has has >1 million mainframe CPU seconds re-platformed. It moved to Ocient after end of support for its Netezza data warehouse was getting near and it decided to re-platform that and mission-critical jobs on its mainframe environment. It migrated years’ worth of data points about each of the 500 million commercial entities in its data cloud. Within the first six months, more than 1.5 million CPU seconds were re-platformed with the new solution maintaining 99.992 percent uptime and zero business disruption. Read about it here.

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Pure Storage reported the largest individual sale of its Cloud Block Store (CBS) to a Fortune 500 healthcare organization at almost eight figures in its fiscal 2024 Q1. Pure’s CBS was bought because of its ability to securely store data in the cloud with enterprise features, reduced management overhead, and lower TCO. The customer says that it will be able to significantly reduce its cloud storage spend.

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Data protector Rubrik has appointed Richard Cassidy as its EMEA Field CISO. He brings extensive cyber leadership, threat intelligence and technical advisory experience to the role. He joins Rubrik from Securonix, where he was VP of Global Technology. Cassidy said: “Running breach and threat hunting investigations in the UK & Europe has set me up well for a CISO position, where I’ve been involved with organizations across industry verticals such as finance, military, central and national government and automotive.”

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Reuters says Samsung Electronics reported a likely 96 percent plunge in second quarter operating profit on Friday as an ongoing chip glut drives large losses despite a supply cut. Samsung’s DRAM revenue market share shrank to 43.1 percent in 2022 from 43.9 percent in 2018. Micron gained DRAM share from 22.1 percent in 2018 to 24.5 percent in 2022. Samsung’s NAND market share declined from 35 percent in 2018 to 33.4 percent in 2022. SK hynix was the gainer, increasing from 10.6 percent in 2018 to 12.8 percent in 2022.

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Data protector Storware has announced the release of Backup & Recovery 6.0 with new OS agent support for Linux and Windows. Previously Storware has primarily embraced an agentless approach. The inclusion of OS agents allows users to protect their systems at the file level, offering enhanced flexibility and control over data backup operations. Users can specify the folders they want to safeguard, and full and incremental backups are supported. 6.0 includes a the technical preview of tape support, with a Tape Manager component to streamline and simplify tape-related operations. Users can define tape pool backup destinations to protect VMs, applications, and storage instances by registering the Tape Manager in the system. Release 6 also adds OpenShift Virtualization support plus backing up stateful sets for regular container deployments, and also OpenNebula support.

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Research house TrendForce says the adoption rate of DDR5 is still affected by clients extending the product cycles of older models and postponing the introduction of new models. It estimates the adoption rate for server DDR5 in 2023 will be approximately 13.4 percent. It’s expected that DDR5’s adoption rate will not surpass DDR4 until the end of 3Q24.

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TrendForce says NAND prices are still declining despite production output being scaled back. It’s expected that the NAND flash market will continue to be in a state of oversupply in 3Q23. It predicts that NAND flash wafers will be the first to see a price hike in 3Q23 as prices for module products such as SSDs, eMMCs, and UFS will likely continue to fall due to tepid downstream demand. Consequently, the overall ASP of NAND flash is forecast to continue dropping by about 3-8 percent in 3Q23, though a possibility exists that prices may recover in 4Q23.

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If VAST Data is going to bring AI to data in its August Build Beyond announcement, does this mean it is adding its own version of computational storage?

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WANdisco has confirmed a software support and maintenance contract renewal with Tesco for a two-year period, valued at $200,000, for its usage of WANdisco’s Live Data Plane product. It expects to recognize revenue from this renewal from 3Q23.

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Phil White is looking for businesses or people an interest in acquiring all of the IP he’s developed over the last 30-plus years regarding error-correcting codes and fault-tolerant storage systems as described here.

CloudSoda brings some fizz to data migration

By

Chris Mellor

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July 7, 2023

The CloudSoda data-moving-as-a-service product calculates movement costs in dry runs, has multi-tenant support, and supports a wide range of any-to-any data movement sources.

The eponymous product was called SoDA in 2020 and was a business project of Integrated Media Technology (IMT). That company acted as an incubator and now there is a separate CloudSoda business. It’s small with just 13 employees but has produced a data mover and cost calculator from scratch. The crew won a NAB Show Product of the Year award in April this year.

We were briefed by EVP Sales Brian Morsch, an ex-director of sales at Pure Storage, and chief product officer Greg Holick, who comes from Western Digital with an intervening Seagate stint. Both are viewed as co-founders.

Morsch told us: ” When [IMT] brought on Greg and I to build a business, the goal was; you guys are going to come in, you’re going to build our business, and you guys are going to break out the company and the company’s going to run solely on its own. Obviously, during the pandemic, that slowed us down a little bit, but I think the value add of having IMT and their large customer base … was influential. Startups usually don’t have that type of ability to automatically say … we can go into this installed base, show the product, get early adopters. So that was huge in in our growth.”

Holick said: “We’ve … gone from a centralized data movement model to a distributed data movement model, and we can move data quickly, securely and automatically from anywhere to anywhere. We’re trying to just be storage agnostic ecosystem aware.”

The product is based on a hub and spoke design with a central cloud-based Conductor – controller – talking to software agents installed in the source and target systems. The Conductor can be installed in the public cloud, or in a customer’s own environment. A source can be a target as the software is inherently bi-directional. Agents run inside on-premises systems which can be NAS filers, SANs, object storage or direct-attached drives with NFS (v3, v4), SMB (1, 2, 2.1, 3), S3, Azure Blob and GCP storage protocols supported. Desktops and notebooks are also supported.

Supported public clouds are the big three – AWS, Azure, GCP, with all tiers supported – and some tier 2 CSPs – Wasabi, Backblaze and also Storj, the decentralized storage provider, plus generic S3.

There is a multi-threaded, high performance scanner to detect files and objects on the target system, which works across agents. Files and objects can be moved on-demand or according to settable policies with filters. The number of threads involved in a move is dynamic. Holick said:”We have a dynamic threading algorithm that looks at the objects or the files that we’re moving and [their] sizes and we spin up or spin down the number of threads we need to move that data. And that way we’re trying to saturate any network link.”

All data is encrypted before it’s moved and moved in native format. There are webhooks so that CloudSoda can send an alert back to an application to say a transfer has completed.

Once a dataset has been selected for a move the time needed for the movement and the costs involved can be calculated in a test run, without any movement actually taking place. This means you can check out the transfer time and costs of alternative targets to see, for example, if Azure archive storage is cheaper than AWS or Storj, or takes longer than sending the data to GCP.

Data transfer uses UDP file acceleration between agents and a multi-threaded, multi-part REST protocol when moving data to/from the public cloud.

The software hooks into CSP price books to get real-time pricing data. Custom price books can be set up for on-premises storage, thus enabling comparisons to be made of different storage policies.

CloudSoda monitors the move as it is being made and collects stats. Its management analytics can report on moves over time by originating site and site function, costs and also show trends:

There are facilities for billing and chargeback so an organization can send costs to the departments involved, or an MSP could use CloudSoda to offer data movement facilities to each of its customers as CloudSoda is multi-tenant. The management facility is integrated with Active Directory and Okta and supports role-based access control. The software has API integration with a RESTful interface and easy and integration into existing workflows.

The CloudSoda software can also tag data as it’s moved, enabling subsequent metadata-based searches. This could be used, for example, to move a set of media assets and tagging them all with a project name.

Holick said all organizations move data, particularly in this AI-using era. Project-based migration, with a filer upgrade for example, is a continuing if sporadic need but the general amount of data movement is steadily increasing. There is data transfers from edge locations to data centers and from either to the cloud, or back again. Media Asset Management (MAM) often involves moving media assets up to the cloud for long-term storage. If AI processing is run in the cloud then it needs data on which to operate and that has to get into the cloud.

Holick said: “We can do data collaboration and sharing and things like that as well.”

CloudSoda has partnership deals with MAM suppliers such as IPV, ReachEngine, dalet, CatDV and Elements. Its also partnering Dell, LucidLink, NdtApp, OpenDrives, Quantum and VAST Data.

Morsch said: “We are entertaining raising capital in the next six to 12 months … We see this company growing significantly over the next three to five years.”

The product is priced by node and not capacity or the amount of data moved, which makes its costs entirely predictable. CloudSoda Agent is priced at $18,000/year with a bundle of five costing $60,000/year. Larger volume deals with enterprises needing custom pricing are negotiable. The system needs up to an hour for its setup after which data movement can start.

Its management GUI is uncluttered and easy to use by any storage admin person or data manager. Datadobi (StorageMap etc.), DataDynamics (StorageX), Komprise (KEDM) and WANdisco (Live Data Migrator) are each facing a new data-moving kid on the block with slick SaaS software and growing functionality.

Check out CloudSoda white papers and a datasheet to find out more.

Public cloud spending rising faster than private

By

Chris Mellor

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July 7, 2023

IT research house IDC says public cloud spending by end user businesses outpaced private cloud in the first 2023 quarter and will do so for the rest of the year and out to 2027.

IDC’s Worldwide Quarterly Enterprise Infrastructure Tracker: Buyer and Cloud Deployment tracks spending in multiple market segments including compute and storage infrastructure non-cloud, shared cloud, and dedicated cloud infrastructure. Shared cloud is its term for the public cloud while dedicated cloud is private cloud IT, which can be on-premises or in a colo-type setup, with management by the enterprise direct or a contracted third party.

Kuba Stolarski, research VP for IDC’s Infrastructure Systems, Platforms, and Technologies Group, said: “Cloud infrastructure spending remains resilient in the face of macroeconomic challenges. However, the segment is grappling with substantial price hikes and Q1 marked the second consecutive quarter of declining system unit demand.”

The cloud infrastructure segment saw unit demand slide 11.4 percent year-on-year in the quarter, but average selling prices grew 29.7 percent, “driven by inflationary pressure as well as a higher concentration of GPU-accelerated systems being deployed by cloud service providers”.

Spending in the three categories in 1Q23 was:

Non-cloud: $13.8 billion – down 0.9 percent Y/Y
Shared cloud: $15.7 billion – up 22.5 percent
Dedicated Cloud: $5.8 billion – down 1.5 percent

On a geographic basis, year-over-year spending on cloud infrastructure in 1Q23 increased in all regions except Central and Eastern Europe (due to the Russia-Ukraine war), China, and Canada.

In Stolarski’s view: “Although the overall outlook for the year remains positive, its growth hinges on the expectation that volume will drive it. Prolonged stagnation in demand could pose a significant obstacle to growth for the remainder of this year.”

Nevertheless IDC is forecasting a cloud spend increase for the year as its forecast spending in the three categories in 2023 is:

Non-cloud: $60.4 billion – down 6.3 percent Y/Y
Shared cloud: $68.0 billion – up 8.4 percent Y/Y
Dedicated Cloud: $28.4 billion – up 4.8 percent Y/Y

Cloud spending will stay positive, despite macroeconomic headwinds, due to the drive for modernization, opex focus, and continued growth in digital consumer services demand, while non-cloud contracts as enterprise customers shift towards capital preservation.

In the 2022-2027 period, IDC expects cloud infrastructure spend to have an 11.2 percent CAGR, reaching $153.0 billion in 2027 and accounting for 69.0 percent of total compute and storage infrastructure spend.

Forecast spending in the three categories in 2027 is:

Non-cloud: $68.6 billion – up 1.3 percent Y/Y
Shared cloud: $110.1 billion – up 11.9 percent Y/Y
Dedicated Cloud: $42.9 billion – up 9.6 percent Y/Y

The shared (public) cloud spend of $110.1 billion is slightly less than the non-shared cloud (meaning dedicated cloud and non-cloud) spend of $111.5 million. The two might be equal or cross over in 2028 if the IDC forecast growth trends continue.

Spending by cloud and non-cloud service providers on compute and storage infrastructure is expected to grow at a 10.6 percent CAGR, reaching $148.2 billion in 2027.

Silk extends its Azure high end base down to mid-market

By

Chris Mellor

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July 7, 2023

Silk has moved its Azure storage acceleration technology down to the mid-market by using a mid-range class of Azure SSD storage and a new licensing scheme.

The concept is to provide apps running in Azure that need faster storage IO than Azure’s basic block storage instances can provide. This is done by using Azure ephemeral disks created on the local virtual machine (VM) storage and not saved to the remote Azure Storage. Silk deploys Microsoft Azure VMs into its customers’ subscriptions and deploys its software on top of those VMs.

Silk founder and CEO Dani Golan said: “With this new release, we’re excited that our platform has matured enough to be able to expand our market reach and help even more organizations bring their mission-critical workloads to the cloud.”

Azure ephemeral disks are much faster than standard block storage but don’t provide any data services. Silk’s SW provides services such as active:active high availability, real-time data reduction, thin-provisioning, zero-footprint clones, deduplication, data replication and snapshots.

The release makes it possible to run smaller workloads and deployments on Silk, and users should still see the the performance improvements, data services, and snapshots, etc, that Silk’s existing customers get.

For mid-market customers Silk is using Azure Premium SSD v2 Disk Storage. Why Microsoft is calling its Azure Premium SSD v2 “Disk Storage” when an SSD is not a disk is beyond B&F. Leaving that aside, the Premium SSD v2 storage provides between 1GiB and 64 TiB of capacity, 3,000 to 80,000 IOPS, and 125 to 1,200 MBps bandwidth. They are billed hourly based on the provisioned capacity, IOPS, and MBps.

The new offering offers better resiliency, consistency and durability than Azure’s Premium SSD v2. Silk’s customers use storage capacity in virtual structures called Silk Data Pods (SPDs). Silk is offering small capacity SPDs built on Azure Premium SSDs, and also a new Express Pack at a lower licensing price. This provides a simple entry point for medium-sized companies, as well as for secondary systems of larger enterprises, to run on Silk.

Silk is also providing SAML-based Single Sign-On, SAML standing for Security Assertion Markup Language, and some general performance enhancements.

Aung Oo, GM Azure Storage Engineering at Microsoft, said: “Silk’s unique architecture enables it to build on the cloud-leading capabilities that Azure Premium SSD v2 Disk Storage can provide, delivering to our joint customers extreme levels of performance, availability and scale.”

The new Silk offering is now available on both the Microsoft Azure and Google Cloud marketplaces. You can sign up for a demo here.

Spanner in the works at Kaseya’s Spanning

By

Chris Mellor

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July 6, 2023

Users are experiencing problems with Kaseya’s Spanning backup services.

Spanning provides Backup-as-a-Service for applications and data running in the public cloud. It was bought by Kaseya in 2018. Kaseya is a private equity-owned portfolio business selling infrastructure management, data protection and security products to SMBs through MSPs. It includes the Datto cloud backup and security services offerings and Unitrends backup business alongside Spanning.

We have found multiple users complaining about Spanning backups not taking place. The Spanning SaaS backup service can be set to back up Google Drive each day. Spanning says it offers “automated daily and on-demand backup [and] daily notifications about the state of backups.”

In June users reported problems such as the backups only happening each week instead of daily. Our sources said responses to support call tickets indicated there were issues with Spanning’s backend system. A senior support person told one user this top priority issue was going to be fixed in a coming version of the software.

The Spanning accounting function has also reportedly been contacting users requesting invoices be paid although users have cancelled their accounts. This issue affects some Kaseya Datto users as well. Other customers claim to have suffered duplicate billing.

The backup system sometimes loses access to data and needs to perform a re-index to regain access. In other words, users can’t access their backup data because of an internal Spanning problem.

Kaseya’s VP for corporate communications, Millie Acebal, told us: “Kaseya is working diligently to address the intermittent issue with long-running backups with Spanning Backup for Google Workspace, which we anticipate will be resolved with the next release scheduled for this month. This issue impacts certain customers in the US region only.

“Regarding the need to re-index to regain access to backup data, the support team is aware this can happen and knows how to remediate through a support ticket. While usually a quick procedure, for some customers the re-index process can take longer. As a result, the Spanning team is also working to remediate the conditions that cause a re-index through enhanced backend infrastructure.

“We urge any customers with billing concerns to reach out to their account managers if they uncover an issue.

“We thank our customers for their patience as we work swiftly to resolve the above concerns.”

Open source data lakehouse Dremio has a new boss

By

Chris Mellor

-

July 6, 2023

Open source data lakehouse supplier Dremio has hired ex-Splunk chief cloud officer Sendur Sellakumar as CEO and president.

Dremio was founded in 2015 and has grown rapidly as the need for analytics has become widespread and data warehouses were found to be too restrictive. It has taken in $410 million in VC funding with three consecutive rounds in 2020 ($70 million), 2021 ($135 million) and 2022 ($160 million). But, as we’ll see below, Databricks has raised a whole lot more.

The large language model hype should help Dremio grow. It has been led by Billy Bosworth since February 2020 but he quietly departed in February this year to become a managing director at Vista Equity Partners.

Tomer Shiran, Dremio’s co-founder and CPO (co-founder Jacques Nadeau left in 2021), said: “We are thrilled to welcome Sendur Sellakumar to Dremio as our new CEO. Sendur’s exceptional leadership skills and extensive background in the technology sector make him the perfect fit to lead Dremio into its next phase of growth. His strategic mindset and customer-centric approach align with our vision for the company.”

Sendur Sellakumar, Dremio — *Sendur Sellakumar*

Sellakumar said: “I am honored and excited to join Dremio as its CEO. Dremio’s innovative approach to enterprise analytics and its commitment to empowering organizations with fast, flexible, and reliable access to their data is truly impressive. I am looking forward to working closely with the talented Dremio team to further accelerate the company’s growth and deliver exceptional value to our customers. We are committed to helping enterprise customers realize the value of their data in driving business outcomes.”

He spent nine years at Splunk and was a VP for investment banking at Morgan Stanley before that. There was a 17-month period at ServiceTitan in the SVP Commercial and Construction role, between Splunk and the new Dremio gig. ServiceTitan sells software for home and commercial service and construction contractors.

Billy Bosworth, formerly of Dremio — *Billy Bosworth*

Dremio competes intensely with Databricks, which just bought generative AI startup Mosaic for $1.3 billion. Databricks has vastly more funding than Dremio – an astonishing $3.6 billion with $2.6 billion of that raised in two rounds in 2021. In the 2020-2022 period Dremio pulled in $365 million, still nothing to sneeze at.

Dremio told us: “In February of 2023, due to personal reasons, Billy Bosworth transitioned from the CEO role back into an Executive Board Member role, which is where he started with Dremio several years ago. Between February 2023 and Sendur’s appointment, Edward Sharp, Dremio’s CFO, was Dremio’s acting CEO in the interim.”

After Bosworth left, Dremio’s chief revenue officer, Alan Gibson, went in March, turning up at data science and AI learning system supplier DataCamp as its CRO in May. Dremio CFO Edward Sharp is the interim head of sales. Sellakumar has a CRO recruitment process to complete as well as devising a strategy to compete with rivals.

WANdisco delays footwork to raise funds

By

Chris Mellor

-

July 5, 2023

WANdisco has had to delay completion of its fundraising share placement because it discovered its company registration in the British Crown Dependency of Jersey doesn’t let it issue as many shares as it needs to without further approval.

The company needs $30 million from the share placement, which is now delayed until the end of July if shareholders approve. All of this because its sales leadership failed to detect a rogue senior rep allegedly making out vast fantasy orders during 2022.

The company is registered such that it has an authorized share capital of £10 million divided into 100 million ordinary shares of £0.10 each. The fundraising involved issuing 114,726,069 ordinary shares, 14,725,069 too many. These extra shares would be invalid if the fundraising went ahead without an increase in the authorized share capital.

Jersey company law says such a share increase needs approval by a formal general meeting of the shareholders. So WANdisco will run a formal general meeting on July 24 at 10:30am to seek approval of a resolution to raise the authorized share capital to £30 million divided into 30 million ordinary shares of £0.10 each. It will the amend its formal Jersey company memorandum accordingly. Then the fundraising share placement can go ahead.

The timing for the lifting of its AIM stock market suspension moves back to July 25 at 7:30am, with market admission and share trading starting later that day.

The fundraising is conditional on publication of WANdisco’s 2022 report and accounts, the lifting of the AIM suspension, and the general meeting voting in favor of the share capital increase.

That vote will surely be a formality. Hopefully nothing else will go wrong and WANdisco will get its $30 million to help the company move on.

Storage old guard needs to have its cache and eat it too

By

Chris Mellor

-

July 5, 2023

Comment: Legacy external hardware-based storage suppliers need to adapt to technology threats to their businesses from three incomers – Infinidat, Pure Storage and VAST Data.

Update. Dell PowerMax gen 2 uses SCM for metadata. 6 July 2023.

Dell, Hitachi Vantara, HPE, Huawei, IBM and NetApp have proved adept at adopting or colonizing threats to their products. The NVMe all-flash array threat was dealt with by adopting NVMe technology and not a single standalone NVMe array startup has survived.

Public cloud storage has not killed on-premises external storage either. In fact legacy suppliers are colonizing it with their own file and block offerings as well as absorbing its pay-as-you-go business model for their on-premises users. They are all either looking at the public cloud as another place to run their storage software or tiering data to it. We can think of NetApp as leading this cloud colonization charge with Dell set on the same idea of having a storage environment span the on-premises and public cloud worlds.

Dell (APEX), HPE (GreenLake) and NetApp (Keystone) are all adopting public cloud-style business models, cloud management facilities as well as porting their storage array software to the public cloud.

Object storage has not limited file storage’s market share. File storage suppliers have added object storage technology to their product set and object storage suppliers have brought file interface layers to their products and life goes on as before.

HCI (server SAN) has not taken over the storage world. It has built its niche – witness VMware vSAN and Nutanix – and there it stays, co-existing with the external storage its evangelizing originators intended to replace.

But now the six main legacy storage players face three competitors – Infinidat, Pure Storage and VAST Data – and are not responding to them in technology adoption terms at all, with a single exception.

Infinidat uses memory caching and clever cache pre-fetch technology to produce its highly performant InfiniBox arrays, either disk or SSD-based, and has built a great high-end array business that no one is directly responding to. None of the six legacy players have embraced Infinidat’s memory caching or pre-fetch software and Infinidat is basically left alone to grow its business, apart from the normal tactical per-bid competitive moves.

Similarly for Pure and its technology. A mainstay is its use of proprietary Direct Flash Module (DFM) flash drives whereas the legacy players, with one exception, use off-the-shelf SSDs in their all-flash arrays. Hitachi Vantara used to have its own flash drive technology but reverted to commercial SSDs.

IBM has its own proprietary flash drives as well, FlashCore Modules, but these are not being used as Pure uses its DFMs to take IBM’s FlashSystem sales higher. We say that because IBM’s storage hardware market share is flat or falling and has been overtaken by Pure Storage.

Pure is aggressively growing its business with things like non-disruptive upgrades, the Evergreen business model and QLC flash adoption. Suppliers in the legacy six are adopting elements of this but the core differential, the DFMs, remain unaffected. And Pure promises to ramp up their density faster than off-the-shelf SSDs, thus strengthening its advantage.

Like Infinidat, Pure’s core technology does not face much competition. IBM has the hardware base, the FlashCore Modules, to provide strong competition but does not seem to be doing so.

VAST Data has sprung onto the external array stage in the last few years and is growing faster than Pure did at the same stage in its development. It relies on its DASE (DisAggregated Shared Everything) architecture, single-tier QLC SSDs, and use of storage-class memory (SCM) to store metadata and buffer incoming writes, and is making huge inroads into the market. DASE and SCM use have not been adopted by the legacy six and so VAST, like Infinidat and Pure, is left alone with its technology advantage to win many more bids than it loses.

Except by HPE, which is now OEMing VAST technology.

Interestingly, both Pure and VAST have a disadvantage porting their array software to the public cloud. Neither AWS, Azure nor Google support Pure’s Direct Flash Module Drives so Pure’s software has to run on cloud instances using commodity hardware. Similarly, none of the cloud titans offer storage instances based on storage class memory, hence VAST software ported to the cloud could not use it.

The legacy players could adopt memory caching and pre-fetch algorithms for their existing arrays. It’s only software, but switching to proprietary flash drives would be a major change. It’s virtually impossible. Pure will surely not find that part of its technology advantage adopted by the legacy players, apart from IBM, which has it already. The other legacy players could adopt host-level drive management, though. Again, it’s software and hence more feasible.

VAST is in a similarly defensible position as having existing filers adopt a DASE architecture involves wholesale redesign. More likely is that the legacy vendors will explore development of their own DASE/SCM technologies and, if successful, bring out a new product line.

Such things can be done. Look at Quantum which has only recently introduced its Myriad unified file and object storage software running atop commodity all-flash hardware.

Intuitively, we would expect Dell and Huawei to be among the first to do this.

Bootnote

A source close to Dell told me: “The 2^nd gen Dell PowerMax uses SCM memory for metadata. This is documented in the Product Guide. It is interesting given the announced death of Optane memory. I assume Powermax does this to avoid the penalty of increasing battery requirement to support the vaulting architecture as inherited from EMC Symmetrix and VMAX.”

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CloudSoda brings some fizz to data migration

Public cloud spending rising faster than private

Silk extends its Azure high end base down to mid-market

Spanner in the works at Kaseya’s Spanning

Open source data lakehouse Dremio has a new boss

WANdisco delays footwork to raise funds

Storage old guard needs to have its cache and eat it too

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