The storage industry is showing signs of consolidation even as innovative new companies continue to sprout.

According to IDC's Worldwide Disk Storage Systems Tracker, factory revenue in the worldwide external disk storage systems market grew 6.7 percent year over year to US$3.8 billion in the first quarter of this year. That makes eight consecutive quarters of growth.

The total disk storage system market grew at a slightly lower year-over-year rate of 6 percent in the first quarter, according to the report.

"Storage spending is clearly trending upward as organisations strive to stay ahead of their information storage demands," said Brad Nisbet, program manager in IDC's Storage Systems. "After nearly two years of positive momentum, spending on storage systems, particularly those priced less than $300,000, continues to be a top priority in the ongoing efforts to expand and rebuild IT infrastructure," he said.

EMC continued to lead in the external disk storage systems market with a 21.4 percent revenue share, followed by Hewlett-Packard with 17.7 percent and IBM with 11.5 percent.

Hitachi, which recently refreshed its product line, held the fourth position with 9.1 percent revenue share, while Dell ended the quarter with 7.7 percent in the fifth position.

"An analysis of top storage systems vendors performance over the past several quarters suggests that partnerships are becoming an important component of their market strategies," said Natalya Yezhkova, senior research analyst in IDC's Storage Systems. "This mutually beneficial approach allows each partner to offer more complete solutions for its customers and often opens a door to new market segments and leads to growth in revenue and market shares."