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IBM has bet $2 billion (Dh7.34 billion) that it can offer what no one else is: a complete solution to fix the storage problems faced by companies today.
"This isn't replacing one system with another," said Andy Monshaw, general manager of IBM's system storage division. "This is about filling a space in the market that no else is sharing."
The new storage solution that IBM is offering promises to address such issues as energy costs, security and the ability to structure information in such ways that companies will be able to use it.
The launch is also IBM's way of regaining its dominant position in the storage market. The company invented hard drives back in the 1950s, but according to Monshaw, bad investments and mis-executions over the years cost the company storage market share.
According to IDC analyst Omar Shihab, the storage market is currently very competitive. "Obviously there is an enormous need for data. It's a very hot area for all vendors," he said. "The competition is very fierce."
According to IDC, IBM is the number one storage hardware vendor in the world as of the the first quarter of 2008 with 20.8 per cent of the disk and tape market. In July 2008, IBM reported that its System Storage revenue was up 12 per cent year to year for the second quarter. Total disk revenue was up 20 per cent.
Monshaw has also been part of the team that has helped IBM acquire eight other technology companies in the past two years, and he said IBM is not finished.
"We're always looking for acquisitions," he said. "We're not even close to being done. The space is just heating up. IBM sees this as a strategic imperative." IBM is currently investigating over 150 companies that could supplement their storage technology.
According to IBM's Vice- President of Marketing, Susan Blocher, the only other vendor that can compete with them is HP.
"What you really want is a company that can bring it all together," she said. "We're better than anyone in the industry in bringing out a common system."
IBM is saying that the ability to deliver a complete system will cut down on maintenance costs, which the company hopes will make it marketable to emerging markets, especially those in the Asean region, Latin American and sub-Saharan Africa, areas struggling to bring in experienced employees.
The company has also announced its plans to invest $6 billion into India with the intention of hiring Indians to deliver technology in Asia, according to Jim Stallings, IBM's general manager of enterprise systems. The company will also be focusing on Vietnam and China, which it views as the most important emerging market.
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