IDC Ups Revenue Forecast for Purpose Built Backup Appliances and Shows EMC with Big Lead in Growing PBBA Market

The big news out of IDC is that in December 2011 it upped its forecast as to how quickly it expects the purpose built backup appliance (PBBA) market to grow in the years to come. But this heightened revenue forecast provides a glimpse into why enterprises are selecting PBBAs and which providers they are choosing. Among these reasons, it appears clear that enterprises view PBBAs as an effective solution to address their backup challenges with EMC their top choice as it already holds a big lead in the PBBA market and is poised to extend it further going forward.

The numbers in the announcement speak for themselves as to how much IDC anticipates the PBBA market to grow in 2011 and beyond. For 2011 alone IDC upped its revenue estimate to nearly $2.8 billion from $2.1 billion. That represents a 65.5% increase over its total revenue estimates for 2010 and a 33% increase over its own prior May 2011 estimates as to how much revenue it expects PBBAs to generate in 2011.

IDC also sees this market continuing to accelerate. Its heightened December 2011 forecast shows PBBA revenues growing by 36.6% in 2012, 19.4% in 2013, 10.1% in 2014 and 5.3% in 2015. This represents a compound annual growth rate (CAGR) of 25.6% over this six year period and a final 2015 revenue estimate that is 45.1% higher than its previous May 2011 PBBA forecast.

An item that organizations should keep in mind as they evaluate this forecast is that IDC defines a "PBBA" rather broadly. On one end of the spectrum are those appliances that offer a complete end-to-end backup solution to include backup software, a server to host the backup software and all of the storage needed to store backup data. At the other end are those appliances that are primarily designed to store backup data.

Yet this all-encompassing definition is almost a necessity in this particular technology segment simply because of how PBBAs are being deployed. In some cases, enterprise organizations are making wholesale changes to their backup architecture from the type of backup software they use to their backup target. In others, they are augmenting their existing backup solution with dedicated disk-based backup targets. So while the architecture of each of these appliances is clearly different, their intended use case is for backup.

Giving preference to PBBAs over other approaches to backup is maybe what is most notable about this upgraded IDC forecast. Organizations clearly view PBBAs as a better way to address their long standing backup challenges and are implementing PBBAs at a pace faster than what even IDC anticipated. There are three reasons why this is the case.

• PBBAs provide organizations a way to solve their backup problems now. The word on the street is out and it is that PBBAs work. While PBBAs may still not quite fall under the classification of "plug and play," they certainly come closer to meeting that definition than what organizations were previously accustomed to seeing. So whether a PBBA is an integrated end-to-end solution with backup software and hardware like EMC Avamar or a dedicated backup target like Data Domain, organizations can expect to deploy either one of these PBBA types and quickly have them operational.

• PBBAs improve backup and recovery even as they reduce management time. "Doing more with less" has been the marching orders for every IT shop for which I have ever worked and PBBAs fit perfectly into that paradigm. By simply purchasing an appliance that is pre-configured and ready for your environment, organizations address their immediate backup and recovery challenges even as they allow IT staff to take on other responsibilities.

• EMC's focus on driving enterprise ready PBBA solutions into the market. IDC's Dec 2011 forecast already has EMC positioned with 62% of the total PBBA market share in the first half of 2011. Further, there is little reason to believe that EMC's slice of the pie will change going forward and, if anything, there is a tremendous amount evidence to suggest that EMC will soon have a stranglehold in this area.

IDC's information reveals that EMC owns 62% of the current PBBA market followed by IBM with 20%. The next largest one after that is "Others" with no other storage provider having a PBBA solution that captures even as much as 4% of the PBBA market. Further, EMC is doing a great deal of work to ensure it holds onto and expands this lead.

DCIG's research consistently finds EMC Avamar and Data Domain products at or near the top in their respective categories. But what DCIG's published research does not fully reveal is how the growing integration between these two products is positioning EMC overall to provide a killer PBBA solution for enterprise environments as the IDC findings seem to support.

By way of example, Data Domain has always offered its Stream Informed Segment Layout (SISL™) architecture as a means to increase deduplication throughput speeds without increasing the number of disk drive that are needed in its soluton. In a similar fashion, Avamar uniquely integrates with VMware to both expedite VM restores and do them at a more granular level.

By EMC integrating these two products more closely together such as EMC did in early 2011 by adding DD Boost to Avamar, organizations have at their fingertips a complete, end-to-end hardware and software backup solution from a single provider that consists of best-of-breed products backed up by what is arguably the best support organization on the planet. Right now no other enterprise storage provider is as strongly positioned to make and backup these claims as EMC.

PBBAs are turning the world of backup and recovery upside down by helping to transform what is often a cumbersome and problematic process into one that is becoming more "plug-n-play."  PBBAs deliver almost immediate results, improve backup and recovery results and reduce administrative overhead. Therefore it should not come entirely as a surprise that IDC felt obligated to up its total PBBA revenue forecasts by 33% over its prior 2011 forecast and by over 45% for 2015.

Yet what many may not consider is how and why EMC is contributing so heavily to this increased IDC revenue forecast for PBBAs. By EMC being a single provider of both Avamar and Data Domain PBBAs and continuing to take steps to integrate the two, EMC is presenting enterprise organizations with an option no one else really offers: an enterprise caliber PBBA. This helps to explain why EMC already has 62% of the PBBA market and is poised to capture a sizeable portion of the PBBA market's 25% CAGR in the years to come.