Why Systemic Storage Problems Remain Unsolved

Last year saw a dearth of real industry leadership, especially in storage technology, and a lot of posturing and posing. Why can't innovators with great ideas find venture capital?

A good friend of mine, long-time storage engineer and former employee of a brand name storage software company, has a great idea for a way to match applications to their storage requirements. Like so many, he was “downsized” by his company in 2003 and decided to start up his own firm to pursue his dream software development effort.

Bob’s idea is a prerequisite for true Information Lifecycle Management. It gets down to the business of characterizing the data produced by applications so that policies can be developed to migrate the data through the storage infrastructure throughout its useful life.

Bob’s ideas are innovative, non-disruptive, and potentially profitable for investors since the resulting product might be a candidate for acquisition by an established storage company in the future. Heaven knows that a lot of money has been thrown at lesser ideas in recent recollection.

The problem is, however, that Bob can’t get funded. Nor can many other “Bobs” I know personally or have met at industry conferences. A key problem is that his technology doesn’t fall squarely into the “hot button” areas identified by the venture capital (VCs) funding agents for the coming year.

What are the hot button areas today? I learned about them from a couple of VCs I visited in Washington, DC recently.

“Data hygiene” is one. VCs believe that people want to police their data, to cull out duplicates and dreck from their storage platforms, eliminate virus programs and MP3s and unsolicited e-mail—the clutter that fills expensive disk arrays to the brim.

Another hot button is data retrieval. Everyone wants ways to get at specific files expeditiously, to quickly and easily retrieve that one e-mail or that one memorandum that cannot be extracted intuitively from the enormous and growing data pool in response to an SEC audit or other regulation-inspired investigation.

Finally, security is a big issue. Part of it is compliance with regulations on privacy or homeland defense, but a lot of the concern with security has to do with the almost daily reports of malicious attacks on companies by hackers and other ne’er-do-wells.

In short, while Bob’s technology may be very reasonable and well thought out, it doesn’t solve a hot button problem with an out-of-the-box fix. That, plus the fact that Bob doesn’t look like an insane technologist who wears torn T-shirts instead of suits to VC interviews, costs him the nod for VC funding every time.

I can’t fault the VCs for their desire to define markets with fast-revenue-making, high-gross-margin-producing potential. In the final analysis, these firms help to map technology to specific business requirements—if they are doing their jobs correctly.

On the other hand, I doubt that a VC will ever perceive—let alone fund products to address—more systemic problems like data management or ILM. Traditionally, in fact, this has been the domain of large technology vendors, whose R&D shops are tasked to engineer architectures and not just point solutions.

The problem is that the big techs don’t seem to be acting like big techs. They seem more concerned with developing technology that will enable them to own a customer’s purchasing department to the exclusion of other vendors than broadening the horizons of technology itself. Everyone is looking over his or her shoulder at Dell and wondering whether the real money is actually being made by reselling commodity equipment on the Web.

Ask a big vendor why and you will likely hear the simple statement, “We are giving customers what they ask for.” It seems as though they have abandoned the philosophy of expanding the list of options from which the customer can choose.

To be sure, solving big engineering problems is less lucrative in the short term than is selling lots of point products. However, leadership requires the development of evolutionary frameworks that provide a means to integrate point complexity into a seamless whole. When a vendor establishes leadership in this way, people like my friend Bob gravitate to them instead of trying to roll their own companies.

Last year has shown a dearth of real industry leadership, especially in storage technology, and a lot of posturing and posing. Maybe 2004 will be better, but I am not counting on it.

Perhaps what is needed is an entirely new paradigm. What if a consumer-centric organization (SNIA is a vendor-centric organization) was founded to define a visionary framework into which myriad storage software products could attach? What if this organization demanded from all hardware vendors their application programming interfaces so that a common services layer could be established once and for all? (Those who did not deliver their APIs could be rightfully and publicly accused of a lack of concern for their customers’ problems.)

If such an organization existed, independent software developers with good ideas (like Bob) could join up. Their costs of operation (and need for VC funding) would be dramatically lower because membership would enable them to free up resources currently dedicated to API acquisition and management. Bob and ISVs like him could focus their entire attention upon fixing all of the things that are wrong with storage today.

What do you think of this idea? Write me at jtoigo@intnet.net.

About the Author

Jon William Toigo is chairman of The Data Management Institute, the CEO of data management consulting and research firm Toigo Partners International, as well as a contributing editor to Enterprise Systems and its Storage Strategies columnist. Mr. Toigo is the author of 14 books, including Disaster Recovery Planning, 3rd Edition, and The Holy Grail of Network Storage Management, both from Prentice Hall.