Buffalo Leads In NAS Distributor Sales, But HP Grows Fastest

Buffalo Technology still has the best-selling brand of NAS products through distribution, but Hewlett-Packard is the rising star of NAS channel sales thanks to its combination of entry-level and high-end products.

Buffalo Tech accounted for just over 22 percent of U.S. channel sales through distributors during the first half of the year, while HP with its 16.6 percent share and NetApp with its 16.3 percent share placed them at a virtual tie for second place, according to data from CRN's latest Channel Best Seller data, complied from the NPD Group's Distributor Track data.

Adaptec came in fourth with an 11.3 percent share, while IBM followed with a 5.2 percent share, according to NPD.

However, while Buffalo Tech's and NetApp's shares dipped slightly, HP's soared by 13.4 percent, helping it leapfrog both NetApp and Adaptec to the Number Two spot.

The full results of the Channel Best Seller study, including a list of best-selling products from 24 different categories, are expected to be released on Nov. 26.

HP's growth stems from the two ways it approaches the NAS market, solution providers said.

At the high end, HP has grown its NAS business thanks to its acquisition early this year of PolyServe, a maker of storage software for clustering NAS appliances and consolidating Windows and Linux servers and storage into scalable utilities, said Phil Blackley, sales manager of Enterprise Computing Solutions, a Mission Viejo, Calif.-based solution provider.

Using the HP Clustered Gateway, based on the PolyServ technology HP OEMed prior to the acquisition, solution providers can put any storage behind it, including HP's XP, EVA, and MSA products, Blackley said.

"Before, NAS was a weakness in our offerings compared to NetApp and EMC," he said. "But now it's a growth area for us."

The PolyServ technology was good, but the HP Clustered Gateway is great, Blackley said. "It was hard for HP to sell as an OEM product," he said. "But when HP acquired it, it strengthened HP's product line."

At the entry-level, HP has been growing HP ProLiant Storage Server NAS sales with a NAS appliance combining its ProLiant server with Microsoft Windows Storage Server software, said Dhruv Gulati, executive vice president at Lilien Systems, a Larkspur, Calif.-based HP solution provider.

Small and medium business is a huge and growing business for NAS appliances, Gulati said. "HP is a pretty easy sell for small business and small office users," he said.

For Lilien, the biggest competition for HP's NAS solutions comes from NetApp, Gulati said. "But HP has a complete solution: servers, storage, and software," he said. "Customers can get everything they need from one vendor."

Buffalo Tech's strength comes from its appeal to both small businesses and to departments within large corporations and government institutions, said Larry Grippo, vice president of sales at Corporate Computer Solutions, a Harrison, N.Y.-based solution provider.

"Customers are asking for products that do exactly what the Buffalo products do," Grippo said.

While NetApp is one of the two vendors with EMC for NAS overall, it is only third in the Channel Best Seller category because the company still gets nearly half its sales from direct channels, and because it also has a large number of direct solution providers who do not purchase through distribution.

NetApp also accounts for most of the growth of IBM on the list thanks to the OEM deal signed in June of 2006 between the two under which IBM OEMs nearly all of NetApp's product line for its channel sales.

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