What is Dot Hill? It's a disk array manufacturing company that sells its products totally through partners; OEM to reseller. There are three tier one drive array vendors, we might say. These are EMC, Hitachi Data Systems, and IBM. Then there is a second tier of vendors which includes Dot Hill, Engenio and Xyratex. They make what could be described as vanilla arrays which are sold through partners.

End users don't generally see these brands. Many NetApp customers are actually getting Xyratex arrays. Many StorageTek and SGI customers are getting Engenio arrays and Sun customers are getting Dot Hill arrays when they buy StorEdge 3500 family products. We have mentioned Engenio and Xyratex recently; now it is Dot Hill's turn.

The company produces RAID arrays and controllers. It is the result of two previous companies merging and then buying Chaparral Networks. The merger brought together a Sun OEM supply for military-spec and telco-spec (NEBS 3) drive arrays and RAID arrays sold through a variety of channel partners. These arrays were built into usable products using bought-in controllers. The Chaparral acquisition gained Dot Hill its own controller intellectual property (IP).

Why does this matter?
European marketing director Raymond Groebbe explains that more functionality is being assumed by controllers. It makes it easier for Dot Hill's partners building products if they can use as capable components as possible. There is a benefit from the military/telco-quality products Dot Hill makes because partners want kit that they can rely on. They don't want their customers having problems because bought-in components fail. Groebbe says: "Quality and reliability is key for indirect sales. Our partners don't want customers to send product back or have failures."

Dot Hill broadly provides RIO and Rio Xtreme drive arrays and SANnet SAN storage arrays that have Fibre Channel connectivity and SATA drives plus SAN scape management software. Groebbe says: "Xyratex is a competitor in the Rio arena. (But) they own less of their IP than Dot Hill." Other competitors are Engenio, and also its parent LSI Logic for controllers.

The value that Dot Hill adds to its arrays lies between the standard disk drives on the one hand and the standard connectivity on the other: 2Gbit/s Fibre Channel; SCSI, etc. It is in the RAID head or controller. This is true for Dot Hill, Engenio, IBM and Xyratex. Groebbe explains that the better this performs then the better the whole storage array performs.

Typically controller performance is measured as transactions or I/Os per second and throughput or MB/sec. A high transaction rate is good for transaction-based applications. A high throughput is good for streaming data off the array, useful in media applications. Let's compare arrays on the MB/sec throughput metric.

IBM's FastT 900, now called the DS4500, has a throughput of 795MB/sec. The Xyratex RS-1600-X24 has a throughput of 690MB/sec. The Engenio 5884, another 2Gbit/s FC array, has sustained I/O rates, burst I/O rates and sustained throughput rates for both Fibre Channel and SATA drives available. The MB/sec rate is 795 for FC and 780 for SATA arrays, for example.

Dot Hill's Rio Xtreme, a comparable array to the IBM, Xyratex and Engenio products according to Groebbe, has no throughput figures publicised. But Groebbe asserts that the Rio array costs much less than the IBM one and greatly out-performs it in media streaming applications.

Without knowing the throughput we can't independently work out the relative price/performance of the Dot Hill array. For one of the key metrics, where Dot Hill claims superiority for its technology, there is no available public evidence. We just have to take Dot Hill's claims on trust.

Developments
Groebbe says: "There is constant tension between the quality characteristics costs and the drive for more terrabytes of capacity at the lowest cost." What Dot Hill has to do is to respond to the drive for lower costs of capacity without dropping its quality standards. It also has to keep up with performance needs. Engenio's 6998 array provides throughput of 1.6GB/sec and uses 4Gbit/s Fibre Channel links. Arrays in general are taking on board 4Gbit/s Fibre Channel links.

Now that Dot Hill has its own controller IP, it is developing a set of new products which will be "performance-sensitive", provide nearline storage capability and new RAID functionality. They will probably use a switch-based design to link drives to the controller (SBOD). Groebbe claims: "We will be leap-frogging our current products and our current competition as well," singling out Engenio and LSI Logic.

To leapfrog Engenio's products means, if the Engenio 6998 array is the benchmark, exceeding 1.6GB/sec throughput and 79,000 IOs/sec, plus supporting 4Gbit/s Fibre Channel. We're looking at c2GB/sec throughput and c100,000 IOs/sec. Nearline storage is code for SATA drives by the way.

Groebbe sees no real demand for iSCSI yet but says Dot Hill has the capability to react quickly should demand ramp up. A contrasting view comes from Network Appliance's Tim Pitcher, VP strategy and business development EMEA. He says, "IP SANs are exploding" and cites over 2,000 customers. Dot Hill better get its iSCSI technology ready.

Update
In Market Watch on May 24 we read 'NEW YORK (MarketWatch) -- Xyratex Ltd. fell 91 cents, or 5.6 percent, to $15.35 after the data storage company was downgraded to neutral from buy at Merrill Lynch, which cited the lack of apparent growth drivers for the company beyond 2006. "We believe that Dot Hill has the leading bid to provide disk enclosures for an unannounced Network Appliance product, expected in the next 9 to 12 months," said Analyst Shelby Seyrafi in a note to clients. "This limits potential incremental revenue opportunities for Xyratex." Seyrafi noted that Xyratex is currently the sole supplier of disk enclosures to Network Appliance. Seyrafi cut his 2006 adjusted earnings estimate to $1.66 a share from $1.78. Dot Hill ticked up 2 cents to $5.20.'

This probably/possibly relates to the upcoming refreshed Dot Hill product that will 'leapfrog' the competition.