Communications and Technology Industry Research

In a new report this week, IDC (News - Alert) predicted that the worldwide enterprise storage system semiconductor market will grow to $1.3 billion by 2012, representing a compounded annual growth rate (CAGR) of 6 percent. Original equipment manufacturers (OEMs) are being compelled by the semiconductor demands of the storage system market to move quickly and capture as much of the market as they can or face being shut out by enterprise customers, the report said.

 

But, pricing pressures coupled with technological changes will fluctuate the storage systems market opportunity for semiconductors throughout the forecast period, IDC said. Chief growth drivers will be the growing need for SAS (News - Alert) expanders/multiplexers and storage services processors and the emergence of iSCSI and fibre channel-over-Ethernet (FcoE) products. The semiconductor vendors should carefully watch the market dynamics among the technologies such as 10GE/iSCSI from a SAN perspective, FcoE, and SAS, to capture a significant share of the storage system semiconductor market.

 

The IDC study, “Worldwide Enterprise Storage System Semiconductor 2008-2012 Forecast,” focused on application-specific standard products (ASSPs) and ASICs shipping into direct-attached storage (DAS), network-attached storage (NAS), and storage area networking (SAN) systems. The key application markets for 2008-2012 segment a top-line forecast for the semiconductor components used within these storage system markets.

 

“Unlike markets for networking-related silicon (e.g. Ethernet, xDSL), the storage system market experiences shorter time periods for selection, qualification testing, and installation,” said Aileen Arcilla, IDC analyst. “Semiconductor companies already playing in the slower moving storage mechanism, networking, or telecom markets thus view the market potential for storage system semiconductors as a rare complementary growth driver for their business.”