The Storage Opportunity

Published for the Week Of October 4, 2004

f Dell can do it, why not the custom-system channel?

With storage hardware becoming a commodity, system builders are increasingly taking on projects that require them to build custom storage arrays to complement their growing server sales. To date, this market has largely remained the domain of big hardware vendors, appliance makers and storage integrators. The custom-system channel, while eyeing the opportunity for some time, has yet to take the plunge in a big way.

Has the time now come for system builders to put storage on the menu? That’s a tough question. We examine the trend in our first story. Those in the field tell us that some of the right pieces are in place: Applications are driving the need for more storage, prices are falling and custom-built servers continue to gain mind share. Elsewhere, Microsoft’s Windows Storage Server is opening the door to custom NAS devices. Some system builders are venturing into the market, and if they are successful, others will follow.

In fact, if there is any one theme that ties together this Custom-System Solutions report, it is that this channel never stops looking for new ways to add value. Our system builder profile features Tangent Computer, which is venturing off the beaten track by launching a spam-filtering service and finding synergies with the system-building side of its business along the way. The CRN Test Center, meanwhile, takes a look at the new BTX form factor and foresees opportunities for solution providers to deliver new value through product customization. And our marketing feature details opportunities for system builders to use eBay as another sales channel.

But perhaps the most intriguing feature in the package is the Spec Sheet, which reviews the latest CRN monthly polling data. Over the first half of the year, an increasing number of solution providers have turned white-box assembly over to system builders.

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That may have more to do with the economics of solution-selling than system-building. When the market swings up, solution providers put more resources into selling and less into building. That’s one guess. Only time will tell whether this a cyclical or a long-term trend.