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HP takes aim at the SMB storage market

Company releases new All-in-One storage solution for under $10,000

Eager to snatch a piece of the burgeoning SMB storage market, Hewlett-Packard Co. has released its own answer to the network storage needs of smaller companies with a new StorageWorks All-in-One (AiO) Storage System.

HP is the latest in the growing list of tier one vendors striving to make storage for small and medium businesses a low-cost reality. Earlier this year EMC Corp. and most recently Network Appliance introduced small business storage appliances to their portfolios.

HP’s solution combines network attached storage (NAS), storage area network (SAN) and data protection under a single management framework.

Typically SMBs have two to three servers running applications like Microsoft Exchange, Microsoft SQ Server, Oracle and accounting software all sitting on direct attached storage, said Parag Suri, category business manager for network storage solutions at HP Canada.

“DAS is not very efficient and difficult to manage because when you want to add more storage, you have to buy more servers or add more disk creating islands of storage and servers, making management a total nightmare,” said Suri.

According to HP, more than 60 per cent of SMB customers have not deployed networked storage, added Suri, mainly due to cost and complexity.

But with HP’s product “all the functionality is built into one single device with a simple management interface which works at the application level,” he said. “SMB customers can now move from DAS to a network storage product without having to compromise on cost and complexity.”

The HP AiO, which runs Microsoft Windows Storage Server 2003 R2, is available in two models. The entry-level AiO400 comes with a raw Serial ATA (SATA) drive capacity of one terabyte and is listed at $7,000.

The AiO600 starts at 1.5 TB or 3 TB of SATA storage or 876 GB of serial attached SCSI drives with a list price starting at $9,000, including redundant power supplies and fans.

Suri said the sweet spot for an AiO storage system is a customer with three to 14 servers and between 50 and 250 employees.

“It’s very simple. You don’t have to buy separate NAS, SAN and data protection technology plus the management interface is dead easy,” he added.

The AiO storage manager allows IT administrators to view storage use and data protection in an application-centric framework and in less than 10 clicks, said Suri, customers can set up shared storage for Exchange using a wizard tool pre-populated with Microsoft and HP best practice recommendations.

HP has also integrated StorageWorks Data Protector Express software into the AiO storage manager to enable data backup and recovery from tape, virtual tape and optical or external disk on the network.

According to John Sloan, senior research analyst at London, Ont.-based Info-Tech Research Group, HP’s focus on the management layer of its AiO system puts the company at an advantage.

“They’re (HP) taking an application oriented view which is a plus for them,” he said.

In late 2005, Sloan said there was a renewed interest in mid-market storage solutions in the $50,000 price range, but over the last four months “the pendulum has shifted and vendors are now focusing on products for SMBs.”

While this AiO product does hit the right notes and meets some of the issues of the SMB market, Sloan added that HP is not the only game in town.

“There’s a lot of activity and I suspect as Windows Server 2003 R2 finds its way into more NAS appliance products, traditional NAS vendors will be peddling their appliances as iSCSI/NAS all-in-one type solutions.”

For channel partners already selling HP storage, Suri said AiO opens a new market segment and revenue stream.

He added that VARs that already sell HP servers, laptops and desktops to SMBs can now fulfill their businesses storage requirements. “Fifty to 60 per cent of the SMB storage market is untapped,” he said.

“It’s a profitable opportunity because in addition to the AiO solution they can also up sell other features like a tape library, tape drive or replication solution.”

Suri added that no special certification is required to sell the AiO system and HP will provide resellers with tools such as Webinar training, product literature and demand generation.

In addition, partners are given a 12-minute demo CD to walk customers through the product and storage manager, providing a full perspective of the technology’s benefits and how it reduces complexity, said Suri.

Although reluctant to provide margin information, Suri said in the storage environment margin potential is between the low to high teens bracket.

“We allow them (VARs) to set prices based on market opportunity. It depends a lot on the expertise of the channel partner providing services, consulting and break/fix work around product.”