Few markets have grown as quickly as the storage area networking (SAN) market has over the last few years. Research company Gartner Group predicts that hardware sales revenues will grow from $1.2 billion in 2002 to $4.3 billion in 2006 as data growth continues. Gartner also remarks on vendor consolidation, with leading players such as Brocade and McData continuing to increase market share at the expense of smaller players.

However in August 2002, excitement was injected into this perhaps over-comfortable situation with Cisco's arrival following its acquisition of 270-employee Andiamo, quasi-independent maker of director-class SAN switches.

"The entrance of Cisco/Andiamo puts a flare in the sky announcing the zombiehood of Fibre Channel. Four years at the outside, two years at the earliest," pronounced analyst Ashok Kumar gnomically. Storage networking research company Byte & Switch concurred that Cisco's entry was disrupting an insular market.

A year and a bit later, it's time to see what difference Cisco's entry has made, how the networking giant sees the future of director-class SAN switches and how other players have reacted.

Cisco makes an entrance
Simply put, Cisco's entrance has as yet made little or no overt difference. Gartner's revenue chart puts Brocade and McData at the top, the former with 34 per cent of the market, both continuing to grow. Cisco is invisible. Yet in most markets where it is a player, Cisco wants to dominate.

In terms of product, with Andiamo's incorporation Cisco now has a full range of enterprise switches. According to the company, its MDS 9000 series of multi-protocol devices provides support for Fibre Channel (FC), iSCSI and the FC over IP (FCIP) tunnelling protocol as well as virtual storage-area networks (VSANs, analogous to VLANs) and new FC diagnostics. Ian Bond, Cisco's UK business development manager for SANs, said, "we have changed the SAN world with manageable, highly available systems, all based around our silicon using our switching expertise. The customer can turn on features whenever they want."

Among the key features in its range are management and congestion alleviation which, according to Bond, can both recognise when traffic is about to back up causing dropped frames and take appropriate action. In addition, Cisco's VSAN architecture allows enterprises to build one physical infrastructure yet have it appear to the network as several isolated SANs, the benefit being as with VLANs to separate data streams for security and management reasons. In this, it is not alone.

In terms of the religious struggle between IP and FC, Bond said that Cisco remains focused on FCIP using Gigabit Ethernet for long distance transmissions linking data centres for replication and disaster recovery, though with FC for data transport within the SAN.

Cisco is being aggressive in its approach. According to Bond, the development of the SAN market "hasn't been as dynamic as networking till Cisco arrived. Now the competition is going out there to acquire new technology. We've shaken up the market and they're struggling to catch up."

Brocade motors on
Big boy in the playground Brocade meanwhile calls steady as she goes. European sales and marketing manager Paul Trowbridge described the company as possessing as "the biggest installed base with 60,000 SANs, three million ports, and the biggest footprint all in large enterprises. We have the biggest support matrix - that means channel and supply routes, and an eco-system of other vendors with products that are tried and tested on Brocade platforms."

Trowbridge added that Brocade had the benefit of multiple applications, such as management and backup, built into its switch fabric, and "multi-purpose products that customers can drop into existing SANs relatively seamlessly".

In addition, Brocade recently announced multi-protocol fabric routing services, in part a product of its $175 million purchase of rival Rhapsody Networks in November 2002. To be delivered on Brocade's flagship Silkworm platform, the services will include FC-to-FC routing, iSCSI-to-FC bridging, and FC to FCIP translation, all on a per-port basis. Key benefits include SAN consolidation, allowing multiple SANs to be grouped into logical SANs. Trowbridge said the services were "being trialled right now with HP, EMC and Veritas for delivery next year".

Refuting charges that Brocade products were proprietary, he said that it was "more of a perception than a reality for the majority of customers." Previous press comments were, said Trowbridge, "about nuances" and "a misinterpretation of the reality". He acknowledged though that customers "tend to standardise on a single supplier".

On the competition, Trowbridge said that Cisco SANs were better placed in greenfield sites, adding that Cisco "will have a future if they stick at it long enough. They've made very bold growth statements which they haven't achieved. Their history is not always successful at breaking into new markets."

McData makes an EMC of things
Meanwhile, things at second spot player McData, an EMC spin-off in 2001, are not all rosy. Last week top sales executive Alain Andreoli resigned after less than a year in post "to pursue another business opportunity", according to the company. Further trouble is expected, said Byte & Switch, as a result of reseller EMC's pressure on McData to reduce its prices. This led the company to state that it "expects revenue in the range of $93 to $95 million in the third quarter, compared with the company's previous expectation of $107 to $112 million".

In response, McData is trying to reduce its dependence on EMC and recently cut a resale agreement with NEC. It also pronounced recently that it was the only SAN switch vendor to increase its market share in 2Q03, using figures from Dell'Oro Group to bolster its claim.

On the product side, following its $102 million acquisition of Sanera McData committed to developing products with 256 ports and up in a single Sphereon system. It said it would begin OEM qualifications for the new product in the first quarter of 2004.

Conclusions
According to some observers, Brocade and McData have fallen behind, the former because it is struggling to integrate Rhapsody Networks' technologies into its product lines. The late arrival of its multi-protocol services suggests those observers may well have a point. However, there's no doubt that Brocade dominates the SAN market, evidenced by the array of third party products certified to work with its products.

However, observers believe Cisco's entry into the SAN market is bound to have an effect on enterprise buying patterns. While some of that will come from its product feature ratcheting, Cisco has also quickly formed alliances with OEMs such as HP, EMC, HDS and IBM.

And when you're dealing with a $19 billion behemoth such as Cisco, other forces are at work. Storage managers, experts in their field, have traditionally enjoyed buying decision autonomy, cut off from broader concerns. Meanwhile Cisco, with its networking hat on, already has the ear of upper management and is likely to recommend storage products and strategies that entail displacing existing SAN vendors' kit. With discounts to be had from existing volume discount agreements, finance directors may well insist on taking the capital budget savings that buying Cisco could entail.

Given Cisco's massive financial clout, some have suggested it might even acquire a storage vendor. Whether or not that happens, there's no doubt that networking giant Cisco wants to become a storage giant too. How Brocade and others can stave off the gorilla is as yet unknown, but it will be interesting to watch.