Shrinking iPads, Ultrabooks will lead to disk boost: WD boss
As EMC, Netapp become the meat in a cloudy enterprise sandwich
WD showed a slide at its annual summit earlier this month that described the current computing market as "very chaotic". That would be a highly relative description, given the storage giant had booked the summit into Istanbul just as a sit-in at a park in the Turkish city had escalated into a three-day battle between protesters and riot police, with satellite skirmishes in other towns and cities across the country.
However, WD has just endured its own riotously chaotic period, as the surge in the popularity of SSD-based tablets and notebooks combined with the 2011 floods in Thailand to ensure a torrid few years. Less teargas perhaps, but more dents in the P&L and balance sheet.
But as well as coinciding with the Istanbul protests, DWD's summit was happening just as the first Haswell-based devices were being aired at Computex. That same week, WD announced its thinnest hard drive - a highly discreet UltraSlim Blue 5mm 500GB device, a Blue 7mm 1TB device, and and its 5mm hybrid devices.
This should be music to the ears of anyone looking to produce, or buy, Ultrabooks who chafes at the capacity restrictions imposed by full SSD devices.
But while WD is cautiously optimistic that the devices give the PC industry a chance to fight back after an almighty kicking from the iPad over the last few years, its job, as Rich Rutledge, SVP and general manager of its data centre storage business, puts it, is to "get storage into the hands of people who need it". Whether those platters are spinning within a discrete device or in a cloud providers’ data centre is really not its concern.
Rutledge said that from WD's point of view, the notebook PC, while it isn't necessarily storming back, is at least on the brink of reclaiming its primacy as the primary computing device for most users. The 10-inch tablet was undoubtedly a core computing device and therefore tore market share from traditional devices, he said. But the market is shifting away from 10-inch tablets, with even Apple launching a 7-inch device, while phones are getting bigger. He predicted an "interesting" 12 months.
The PC will not attain the centrality it once had, but: "We're very comfortable seeing the tablet as the third or fourth device in your home…[for mobile] we’re comfortable that the PC is the first one.”
That said, as far as Rutledge is concerned, WD's future path would not be shifted much either way. It sells its disks to OEMs that make PCs, but also to OEMs that make arrays and other heavy weight storage products. It also sells into the vast data centres, which now build their own systems - and, of course, to consumers.
"Non-PC integrated products are 55 to 60 per cent of our business," he says. "We don't consider the data centre business to have any specific growth risks…the non-integrated business is where we have more of our secular growth opportunity."
Part of the WD's data centre business is the Sentinel SMB storage box, a very well-received product that is expected to spawn further iterations over the summer.
As the Sentinel box products are reborn as racks, it's easy to see a situation down the line where WD starts bumping into the enterprise OEMs who put its disks into the boxes. WD has put its success with the product down to not just its storage chops, but to the willingness of SMBs to buy into the WD brand and their desire to buy the products from familiar partners, whether they be resellers or retailers.
Keeping it small
With the upcoming devices expected to support more users, one might expect that WD has designs on the traditional stomping ground of EMC, HP et al - or at least the lower-end fringes.
But Rutledge seemed to be putting a ceiling on exactly how far WD would expand up the chain, though this is as much for channel reasons as anything else.
"It's beyond a thesis, it's just a fact of life. The EMC model, the HP model, is really optimised for a direct sales model. It absolutely does not scale to SMB."
"The S stands for small," and such a large number of companies is "very hard to get to unless you have a brand and a channel."
"We don't have any aspirations to scale up into that other space," he says.
So, HP, EMC et al, can rest easy. As least as far as WD-branded storage boxes go. At least for now. They can concentrate on worrying about the impact of the public cloud services on their traditional markets - whether from enterprises shifting to the public clouds, or in the case of the very biggest companies, from the build-it-yourself model favoured by the likes of Google as it starts to creep downmarket.
"In the case of the public cloud, " says Rutledge, “It's very well known Google makes their own toys...they're fully resourced to be vertically integrated...if they're going to buy from us they're going to buy components."
Google has set the pattern and others are following, he says. For WD, "there's a very large opportunity in that space".
When asked about flash and the public cloud providers, Rutledge once again frames the conversation in terms of traditional disk tech. WD CTO Bill Cain’s own presentation kicked off discussions of flash in the data centre by noting the associated cost and endurance issues.
"The large data centre operators can split atoms of value," says Rutledge. "They can literally measure the molecular weight of the distinct value proposition offered by different solutions. So, if there is a value proposition that exists, the large DC operators will find it."
"Ultimately," he adds, "the cloud model is all about the software model. The hardware is secondary."
So, presumably with consumer, SMB and the public cloud vendors catered for, WD feels it can sit back and watch chaos in both the client and the enterprise array space from a distance. Which is fine, until the wind changes and the tear gas wafts your way. ®