Storage Becomes A Safe Value

Analyst firm Parks Associates, Dallas, estimates the number of U.S. households with one or more networked storage devices will hit nearly 10 million by 2010, up from a mere 300,000 last year. Several factors will contribute to the growth, including falling device prices, more hard drive and home networking companies entering the market, and improved software.

The boom in home and small-business storage networking is being accompanied by new technologies and increased user interest in storing and backing up entertainment and business data. That need is providing digital integrators with ever more opportunities to add value to their installations.

Many of the newer storage devices coming to market are easy in theory for end users to install and use. But that simplicity can be deceptive, and the typical home user will increasingly look for outside help in setting up and maintaining their storage devices.

"A lot of people still feel intimidated by the technology," says Joe Alvarez, digital video consultant at Unitek Pasadena, a Pasadena, Calif.-based integrator. Proper configuration of storage devices is becoming an increasingly significant part of the company's work, and Alvarez says that even tech-savvy customers appreciate help in setting up the products.

Simplifying storage with the right installation and configuration is essential for keeping customers happy, says Tyler Dikman, president and CEO of CoolTronics, a Tampa, Fla.-based integrator. "With a fridge, someone opens the door, and if the food is cold, it's working," he says. "People don't want complication. They don't understand error messages."

Dikman says that while he can barely get double-digit margins from the sale of storage appliances he sells from Sunnyvale, Calif.-based Mirra, a subsidiary of Seagate Technology, the devices ($400 for 160 Gbytes and $500 for 250 Gbytes) allow him to offer higher margin installation and support services. "We show them how to use the appliances, what files to back up," he says. "We sell them installation, training and service time, all in one package."

CoolTronics is also realizing revenue by configuring storage devices for new uses. The company recently started setting up NAS appliances to store customers' music and videos, and to perform automatic backups and synchronization of data stored on their home PCs.

Dikman says NAS appliances such as Mirra's provide simpler automated backups than some of the newer Web-based backup services that allow users to store data to remote servers. "We don't like auto backups over the Web," he says. "A lot of customers don't understand the technology, and they will log on and wonder why their Internet is locked up."

Imagestics, a Friendswood, Texas-based integrator, used to build its own storage arrays to go with its custom-built media servers, owner Michael Conti says. However, the company has since found that it can bring high-capacity RAID-protected storage to customers easier and with a lower cost by using appliances such as the TeraStation from Buffalo Technology.

When installing home theater systems, Imagestics uses devices with a minimum of 500 Gbytes of storage capacity to store the customers' video and music files. The integrator recently installed more than 2 Tbytes of storage to serve content to the 13 high-definition televisions in the home of one customer.

For such clients, RAID-protected high-capacity storage is not about backups--it's about convenience. "They look at the Buffalo piece with RAID to give them the ability to reconstruct their files," Conti says. "It's more of a convenience than a necessity. They own the original DVDs and CDs, so if they lose the files, they can redo them."

Digital integrators looking to protect and simplify digital home solutions are starting to see a new crop of networked storage appliances with such extras as wired or wireless LAN switches or routers, print servers, FTP servers and even automated network management. The added features mean more opportunities for high-margin services.

Michael Schwab, vice president of purchasing at Harrisburg, Pa.-based D&H Distributing, says that digital integrators can soon expect to see storage devices built with four-port LAN switches and security add-ons including biometric LAN access and antivirus capabilities. Customers will need integrators to help them take full advantage of the devices' feature sets and help them solve IP-networking issues. "In the digital home of the future, digital cameras, Media Center PCs, access points and so on will all communicate via an IP address," Schwab says. "Storage is going to be just another IP address on the network."

Those multifunction storage devices are already on the way.

Sereniti, Jersey City, N.J., for instance, just unveiled its Smart Home Server SHS-2000, which adds a wireless gateway and multiport print server to an integrated 80-Gbyte hard drive. Scheduled to ship in January, the SHS-2000 plugs into a LAN and offers automated PC data backups and other features, says Bennett Norell, director of channel development. SHS-2000 customers must purchase a service subscription at $14.95 per month, which gives them $25,000 worth of identity-theft insurance, $1,000 worth of virus damage protection, hardware and software firewalls, 24-hour tech support and configuration snapshots for isolating problems. Digital integrators will have access to recurring revenue from those subscriptions. The company also has an integrator partner program.

Buffalo's TeraStation NAS appliance adds an FTP server, print server and the ability to add external USB hard drives, says Brian Verenkoff, product manager for the company, which has its U.S. headquarters in Austin, Texas. The TeraStation is compatible with Buffalo's LinkTheater Wireless HD Media Player, which allows wired or wireless streaming of multimedia files to televisions in a variety of audio, video or graphic formats. The company this year also introduced a line of LinkStation NAS appliances with 120- to 400-Gbyte hard drives. (For more on the company's plans for the home and small-business integration market, see page 22.)

Addonics Technologies, San Jose, Calif., last month introduced a drive enclosure that allows digital integrators to install up to four 3.5-inch hard drives of their choice and connect to a PC via USB or eSATA. Bill Kwong, president of Addonics, says the Storage Tower is sized well for the home. "People are moving to put their TV and DVD recordings to disk, and the Storage Tower can help do it," he says.

Late this summer, Cerritos, Calif.-based ADS Technology started shipping its NAS Drive Kit, which lets digital integrators add their own hard drives with capacity of up to 400 Gbytes. The $129 kit also includes a Web server, FTP server and BitTorrent P2P client capabilities, says Ivan Randal, product marketing manager. The next version will include media server capabilities.

San Diego-based Iomega this month started shipping the StorCenter networked hard drive with a built-in network media server. The device adds up to one Tbyte of storage to a network, and has USB ports for additional capacity, says Ron Gillies, vice president and general manager of the company's Americas Business Unit. It can also stream video directly to PCs or entertainment devices. The StorCenter lists for $199.95 for the 160-Gbyte version and $289.95 for the 250-Gbyte version.

The Maxtor Shared Storage Plus, which the Milpitas, Calif.-based company started shipping in late summer, adds 200, 300 and 500 Gbytes ($299-$499) of capacity to a network, as well as the ability to share two USB printers or hard drives, says Jane Wasson, senior product marketing manager for networked storage products. It includes automated backup capabilities, and in December the company will enhance its capabilities to allow integrators to use an external USB drive for configurable RAID protection.