StorageTek CEO: 'We're not just a tape company'

StorageTek, a vendor of storage products, has steadily been improving its financial results and evolving its product line since former Xerox executive Pat Martin took over as chairman and CEO four-and-a-half years ago. He talked with Network World Senior Editor Deni Connor last week at the company's annual Forum user conference in San Antonio.

How would you sum up StorageTek's transformation under your leadership?

Financials are the scoreboard in terms of what's going on. StorageTek's revenue has been about flat through its first six months of this year and earnings have risen. In the past four years, we've brought out 75 new products and positioned ourselves to be the largest independent provider of total storage solutions. We are well on our way to achieving that goal.

Users have a mindset that StorageTek is a tape company. What are you doing to change that perception?

One of our biggest-selling products is the Virtual Storage Manager [VSM] - that's a disk-based product that sits with everyone's mainframes. We have about a 60% market share in that business. VSM lets you manage your tape subsystems through a disk cache, so you are running at disk speed and not worrying about the time delays of tape mounts and so forth. Bringing VSM to the open world like we did this week [the product now works with a host of operating systems] is a natural progression for StorageTek.

Since 2001, your disk-based sales have increased to a fifth of that of tape. How has that happened?

When we said we were going to be a total supplier of storage solutions, we had four steps in our journey. The first thing we did was reinvest in our tape and tape automation base. We brought out three generations of tape and tape drives in the last three years and a new series of tape libraries.

Second, we saw the emergence of another tier of storage called ATA and positioned ourselves to play in that area. Where we felt we could have a strong presence is in the information life-cycle management [ILM] area, which is all about putting the right information at the right place at the right time.

The other area of ILM that is a big opportunity is helping our customers manage the backup and recovery of data more simply and reliably with less labor. Today, 50% of the labor in the data center in one way or another is associated with backup and recovery. So it's the last big labor pool sitting in the data center since our tape libraries have taken out the tape jockeys of 10 years ago. [A tape jockey is a person who swaps tapes in and out of auto-loaders.]

The last part is about archival information. Our customers are being inundated with regulatory requirements such as [Health Insurance Portability and Accountability Act]. The ability to store that information in an effective way and be able to retrieve it is a big challenge for customers.

ILM is where we are putting all our emphasis. But that doesn't mean that tape is going to go away; we are going to continue to offer tape products.

Do you do that by tiering storage or putting the disk in an intermediate position between primary storage and tape as an archive?

Yes. You use primary disk for business-critical data. Today, 80% of the information sitting on primary disk is duplicated data in one form or another. If that information isn't accessed for 30 days after it is created, it still resides on our disk subsystems taking up space and quite frankly not being very useful. So what we're about is taking that information and moving it from primary disk to Serial ATA [SATA] drives and from there to our tape libraries. We do it in an automated way based on policies defined by the users.

How have users' moves to disk-based backup affected tape revenues at StorageTek?

We haven't seen any material impact on our business. We have a product called EchoView that backs up data to disk and then to tape. With the SATA drives, much of the information that was backed up to tape will migrate to SATA.

Analysts have said that you have some holes to fill to offer an end-to-end ILM strategy. What would you say those holes are and how are you going to fill them?

Before acquiring Storability, storage resource management was obviously a hole. We are also in the process of coming out with a fixed content system [for archival data].

Is StorageTek's plan to gain technology through acquisition or build your own?

We do both. We have expanded our investments in R&D in the ILM area by a factor of three in the last couple of years. On the other hand, no one company has a handle on all the intellectual property in the world, so we are constantly looking for opportunities. If that opportunity lets us get to market sooner with a strong product, we'll acquire. We typically like to make [technology] because we can integrate it into our products more efficiently, but we are not shy about purchasing technology.