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Why IBM Thinks Storage Hardware Is a Competitive Business

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IBM’s share of the storage market is shrinking

In this series, we’ve discussed the Z and Power Systems sub-segments of IBM’s (IBM) Systems segment. Another important Systems sub-segment is Storage Systems. In the last quarter, Storage Systems revenue fell 5.6%, which the company blamed on growing competition amid continued pricing pressure.

IBM has been struggling in the storage market. According to IDC and as the chart below shows, IBM’s share of the worldwide enterprise storage market fell from 5.2% in Q2 2017 to 4.6% in Q2 2018. Dell (DVMT) led the market with a 19.1% share, while Hewlett Packard Enterprise (HPE) was in second with a 17.3% share and NetApp (NTAP) was third with 6.3%. IBM and Hitachi were other significant market players.

Storage Systems Market Shares

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IBM has launched some innovative storage products

The storage industry is betting on all-flash arrays as the next growth driver. IDC also reported that this market grew by an impressive 42% year-over-year to reach $2 billion in Q2 2018. Meanwhile, the hybrid flash array market grew 21%.

IBM acknowledged that it would need to invest continually in innovation to revive its Storage growth. In this regard, it added cybersecurity features to its storage products to safeguard user data. It also introduced NVMe (non-volatile memory express) technology in its FlashSystem 9100 storage solution, which also has AI and multi-cloud support. However, IBM’s revenue has yet to see the results of these innovations.

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