The storage software industry has seen its first quarterly sales
decline after more than five years of solid growth, according to a
report from market researcher IDC.
First-quarter 2009 revenue for the industry sank 5.2 percent to $2.8
billion from the previous year. The slump has impacted several key
vendors, including Hewlett-Packard, EMC, and IBM, all of which sell
storage software to enterprise clients.
"The combination of the normally slow first quarter for most
companies with the continued economic climate was displayed in this
quarter's results," Michael Margossian, research analyst for storage
software at IDC, said in a statement. "A majority of companies
displayed either negative or very low year-over-year growth."
The software storage industry includes areas, or submarkets, such as
data protection and recovery, archiving, data replication, and storage
device management. Most of those segments were battered by the weak
"On a yearly basis, a majority of the sub-markets declined from the
previous year's first quarter," Laura DuBois, IDC's research director
for storage software, said in a statement. "Predominantly affected were
the Device Management, Replication, and Infrastructure markets, all
segments closely aligned with the storage systems themselves."
Among the top five players, HP was hit the worst with quarterly
sales of $97 million, a 21.5 percent drop from $123 million the
previous year. EMC watched its revenue fall 14.5 percent to $612
million, from $716 million a year earlier. Only Symantec eked out a
small gain, with sales of $531 million, 2.5 percent higher than the
year-ago quarter's $518 million.
The sales decline for the major companies has rippled through the
entire software storage industry. But IDC expects the market to bounce
back once the top five recuperate.
"The overall Storage Software market was pulled down by the
underperforming large companies that make up a bulk of the submarkets,"
said DuBois. "Once they start to recover, they will bring the entire
market up with them."
The software report follows IDC's accounting late last week on the first quarter's poor performance in the disk storage business.