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EMC reveals price cuts, almost

Competition no slouch

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After the monster revelation that EMC isn't actually the impenetrable beast that everyone thought it was, it seems that the company may have given its head a bit of a shake. It seems to be getting all liberal, wishy-washy even.

The storage power-house with the reputation for being the single most expensive piece of technology you can possibly buy, which is admittedly a slight exaggeration, is slashing its prices - talk about a change of tack.

It was the surprisingly calm CEO, Michael Ruettgers, that made the announcement - having let slip earlier last year that EMC could be getting pretty aggressive on price. And last week he backed that up with further claims of aggressive pricing and a renewed competitiveness. Actual facts and figures however were typically hard to find.

Nevertheless, this could be an important step by EMC, which has long been criticised over the price of its hardware. Despite the fact that the company likes to think its is the best in the world, and argues that if people want the best they have to pay for it, revelations a few years ago that showed its sales people being paid staggering commission on sales left an unpleasant taste in many peoples' mouths.

This almost inevitably hasn't helped EMC move forward, particularly not with the competition from the likes of HDS, which is said to be making significant wins over EMC, and IBM hotting up. Just last week IBM itself released a number of new storage offerings - including an attractively priced NAS solution - that could further dent EMC's margins.

EMC however has already got its ammunition in place. At a recent Gartner conference the latest findings from a storage market report showed that EMC had good reason to remain bullish - Gartner still thinks it is unstoppable. Admittedly, if you believe Gartner's figures, which claimed EMC had more than a 34 per cent share of the storage market - then it could well be right. But the competition is no slouch - despite what this pair would have you believe. HDS, as with EMC, managed to bag double digit growth last year, and Compaq continues to assert itself, claiming more than 10 per cent market share in second place altogether.

With all of that in mind, EMC better make sure that it gets it's alleged price cuts flagged pretty heavily because the competition isn't going to be waiting around for it to get it's act together this year. ®

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