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NetApp enters SMB market

Network Appliance offers a new storage product line to small-medium business customers, a fast-growth market increasingly crowded with rivals.

Network Appliance plans to announce Monday it has entered the small-medium business market with a storage product intended to expand its footprint in an area increasingly crowded with rivals.

NetApp is launching StoreVault S500 as its new product line for the small-medium business (SMB) market, and has created as a new division around the effort. For NetApp, the move into the SMB market brings the 14-year-old company full circle, analysts say.

"They started in the (enterprise) midmarket more than 10 years ago with an entry-level filer you could say was for the SMB market. But over the last 10 years, they have solely focused on growing the enterprise market and are now returning to their roots, while continuing their pursuit of the enterprise," said Greg Schulz, senior analyst with StorageIO Group.

NetApp decided to make a play for the SMB market, as storage costs became less expensive to offer to the smaller customers and surveys demonstrated this customer segment faced hurdles in managing data, said Sajai Krishnan, general manager of NetApp's SMB business unit.

"We wanted to deliver a solution that would address the right pain points," Krishnan said, noting the project spanned 18 months.

The SMB market often faces stripped-down versions of enterprise products and a delivery channel poorly suited for its market. But NetApp and other players have recently rolled out products tailored specifically for this customer segment, with dedicated sales teams and distribution channels.

StoreVault S500 is an appliance that targets companies that generally need half a terabyte to three terabytes of storage and spend less than $20,000 a year on storage products and services. Most of these companies, which tend to have an IT manager to address their general needs, employ fewer than 1,000 workers.

The device supports both network attached storage (NAS) and storage area networks (SAN) that use Internet small computer system interfaces (iSCSI). StoreVault S500 is also designed to scale up to Fibre Channel without requiring a separate network storage system.

The StoreVault S500 pricing starts at $5,000 and will be shipped in the U.S. through qualified resellers.

NetApp's archrival, EMC, began experimenting in the SMB market two years ago but came out with targeted SMB products in the past six months, Schulz said.

"It's interesting to see NetApp and EMC pitted against each other in the SMB, but there are other players there, as well. (Hewlett-PPackard) is a big player in SMB and Dell is coming into this area," he added. "This whole market is heating up."

NetApp is not only trolling for smaller customers via its move into SMB, the company also recently announced plans to target high-end enterprise customers, said Patrick Rogers, NetApp's vice president of products and alliances.

"We had scalable midrange enterprise systems, but not like IBM?with the same level of capacity and throughput," Rogers said.

Krishnan noted: "SMB completes our story. We've gone from the midmarket to the high-end market and now we're addressing the SMB market."