This past year witnessed the growing acceptance and credibility of iSCSI, the new storage networking protocol that promised affordable storage area networks (SANs) for small and medium-size businesses (SMBs). But iSCSI surprised everyone by finding its way into the enterprise. While the year 2002 hyped iSCSI and 2003 ratified the standard and ushered in the first pure-iSCSI product offerings, 2004 was the year Fortune 500 customers gave the new SAN a resounding vote of confidence. The best of the iSCSI-based systems available in 2004 gave weary storage managers something they have needed for a long time. As a result, iSCSI storage systems joined Fibre Channel solutions for primary storage applications, spreading beyond the original SMB market into larger enterprises, serving up data to business-critical applications such as email, ERP, CRM, student information systems, digital media archives and online transaction processing systems.

In 2004, innovative storage-savvy startups led the iSCSI charge, and, as the market developed, established vendors weighed in with their own iSCSI offerings. In addition, the iSCSI ecosystem matured rapidly. In just a year we've seen complete support for all of the major operating systems, a variety of iSCSI host bus adapter (HBA) offerings, multi-pathing solutions, cluster support, SAN boot, enterprise backup integration and next-generation data services. Storage system vendors took years to evolve these capabilities with Fibre Channel. Clearly iSCSI has not only leveraged IP networking but has also built upon its storage heritage to achieve parity with its Fibre Channel cousin so quickly.

As a result, serious storage deployments were built with iSCSI this past year, and the word has spread. This points to the fact that established storage vendors don't want to talk about the huge dissatisfaction with monolithic, expensive, difficult-to-manage Fibre Channel SAN systems. It is this dissatisfaction that has driven iSCSI's success, revealing what customers want and need most: a modular, enterprise-ready storage system that will provide the reliability, performance, and features of Fibre Channel systems--but without the complexity and high cost of ownership.

Jockeying for Position

Tremendous interest in iSCSI-based storage solutions created a tide that floated all boats. Vendors with all manner of iSCSI targets with a spectrum of functionality emerged and found someone interested in buying it. When you add to this burgeoning new market the campaign of fear, uncertainty and doubt projected onto iSCSI by the large Fibre Channel vendors, you begin to understand the confusion around iSCSI that appeared this past year. A lot of new products shipped with a wide range of capabilities--and it became clear that not all iSCSI storage systems are created equal.

The low-end became crowded with a variety of low-cost disk enclosures with iSCSI connectivity. Many vendors in an effort to capitalize on the iSCSI trend quickly packaged up 1U and 2U servers with an embedded operating system, some iSCSI software and lots of ATA disk drives. More personal computer than storage system, these systems, while offering SAN solutions at a price point never dreamed of before, lacked any semblance of enterprise functionality and reliability--critical components in networked storage.

The mid-range was much more interesting with systems approaching enterprise capacity and functionality. The most successful of the mid-range are systems that eschew the "iSCSI is for secondary storage" positioning of the large Fibre Channel vendors and offer a robust, enterprise-ready SAN solution that uses the iSCSI protocol to make storage simpler, more scalable and more easily integrated into the enterprise.

So, two distinct iSCSI product categories have emerged: cheap SAN systems for the masses and robust alternatives to Fibre Channel SANs for the enterprise.

It is the latter category that will carry the day next year in a market hungry for standards-based, plug-and-play storage products that can fill the desperate need in the mid-range for reliable, easy-to-deploy and easy-to-manage primary storage.

Established Storage Vendors Respond

The common theme for most vendors in this space is that "iSCSI is good," and everyone wants a ray of the limelight. Some older proprietary IP SAN solutions remain on the market, but they are not getting much air time--in fact, the vendors are retrofitting them with iSCSI and are eagerly claiming those installations as iSCSI market share, downplaying the original proprietary protocol.

Established vendors are playing a similar game. Most are eager to claim iSCSI leadership while being careful to position the new technology as decidedly inferior to their bread-and-butter Fibre Channel systems for enterprise-level primary storage. Network Appliance (NetApp) and EMC both have enabled their current Fibre Channel systems with iSCSI connectivity, allowing them to claim inflated iSCSI market penetration--leading to the most recent IDC Worldwide Quarterly Disk Storage Systems Tracker to rank them as the top two iSCSI market leaders with 43% and 22% of the market respectively.