Compaq touts health of storage business

The PC maker says it has won contracts for storage worth $900 million since September of last year, representing a victory of sorts for the company.

John G. Spooner Staff Writer, CNET News.com
John Spooner
covers the PC market, chips and automotive technology.
John G. Spooner
Compaq Computer is becoming a storage billionaire.

Despite the slow PC market, the Houston-based PC maker said Monday that it won contracts for storage worth $900 million since September of last year.

The deals represent a victory of sorts for Compaq, which made storage a big portion of its multipart recovery plan. The plan was announced last June and came just a few months before its proposed merger with Hewlett-Packard was made public.

Compaq sells a range of storage devices, from basic tape backup systems on up. However, its most lucrative products include its StorageWorks line, which connects large amounts of disk space to computer networks.

Storage has become a jewel for Compaq, executives have said, with profit margins that are among the highest of all of the products it sells.

Some of Compaq's new storage clients include DirecTV, which recently purchased $1.8 million in Compaq StorageWorks products with both disk storage and tape library systems as part of an overall $9 million contract with the company.

Meanwhile Dollar Rent A Car Systems has also purchased a handful of Compaq storage area network products.