Perhaps the reason that NetApp’s sales slumped last quarter may be because NetApp’s consumers took a look at the performance numbers of NetApp’s new units and saw that there is not much of a reason to purchase a new unit? Zerowait recently reviewed NetApp’s published performance numbers on their new FAS3020 and found that there was not much reason to buy a new unit as compared to buying additional storage for an older unit. I can tell you that our sales of add on storage for NetApp systems has been very strong lately.

According to NetApp’s CEO, ‘Warmenhoven says customers took longer to evaluate NetApp systems last quarter following the rollout of new FAS3000 Fibre Channel-plus-SATA systems”
Warmenhoven deos not mention that there are now four sales channels – NetApp Direct, NetApp Resellers, IBM Direct and IBM resellers – all selling the same unit. So savvy customers will shop around for the lowest price. Customers know that price is the only differentiator, all of the service and support is identical. As every salesman knows, it is very hard to differentiate added value for the identical product , service and support.

Perhaps NetApp is so aggressively purchasing other companies because they realize that the profits in storage are going to decline as it continues its trend toward commoditization. I certainly wish they could clearly define a 3 to 5 year corporate strategy, because our customers are trying to optimize their storage purchases based on a consistent vision from their storage providers.

No matter which side the pendulum swings toward within NetApp, our customers can depend on Zerowait to provide affordable service, support and upgrades for their legacy NetApp equipment.

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