HP, Sun and EMC Push SSD

Implications: The move from rotating disks to Solid State Disks (SSD) is happening faster than most predicted.  Rotating disk vendors such as Seagate will likely see margins erode as they lose the high-end disk business to SSD.

Analysis: SSD has been around in one form or another for many years.  It was available in the Eighties as a pricey add-on for mainframes and in the Nineties for servers, but it has never achieved more than a niche status due to the cost.  A few months ago the CEO of Seagate went on record stating he wasn’t worried about SSD, since the price was still too high and not dropping fast enough to be a concern.  Now it’s starting to look like he may have been mistaken.

Major enterprise suppliers have made a movement into SSD recently.  HP made the announcement in the attached article, Sun is providing SSD as an option on some of their servers and EMC is making it available with their high-end Symmetrix storage units.  It is true that the price is still quite high, and reliability remains a concern.  Nonetheless, when vendors of the size and credibility of these three make a move the market should pay attention.

The most-cited concern is the price.  Even today, however, for some high-performance environments the price is competitive with rotating disks.  The fastest rotating disks available are quite pricey, as are the various pieces with which they are packaged, yet they frequently do not provide acceptable performance.  To offset this issue many enterprise utilize only a small portion of the available space on their rotating storage, which allows them to achieve higher performance but also drives up the price.  When SSD is compared in this kind of environment their performance is clearly superior and their price not so different.

The major vendors have all addressed the reliability issue through various technical tricks.  EMC, for example, says that their current SSD offering provides reliability comparable to that achieved with high-performance rotating disks.  When companies such as HP and EMC offer a product it is safe to assume they have made it reliable and expect it to sell in reasonable numbers.  They clearly see a market today, albeit perhaps a small one.

The key thought here is the speed with which the transition is occurring.  This is not something happening in the next 3-5 years as many have predicted, but rather within the next 1-2 years.  SSD pricing is coming down rapidly, much faster than rotating disk pricing, and technological advancements are happening faster.  Rotating disks are still improving, particularly at the lower end of the market, but fast improvements at the high end of the market are constrained by the laws of physics.  SSDs are not yet facing such barriers.

Rotating disks are not going away any time soon.  People have been predicting for many years that tape would go away, yet most data centers still have a major investment in tape.  What is going away is the high-end market for high-performance premium rotating disks.  SSD is starting to move into that market.  The impact will likely be felt within months, and certainly within a couple of years.  That will leave a robust market for rotating disks, but more as a commodity.  That transition will hurt companies such as Seagate, which today achieves higher margins on the premium rotating disks.