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March 22, 2011

Behind the Buzz About Nexenta

Nicole Hemsoth

There have been a number of stories in the past few weeks about storage, more specifically, cloud storage or that which builds on the trend toward virtualization. If research group IDC is correct, the news swell will continue through the year with a 10.3% increase in revenue for the industry overall, landing storage at the $12.7 billion revenue mark by this time in 2012.

Not surprisingly, this burgeoning market will lead to a more populated competitive playing field, although some could argue this has already happened. Despite all the noise, however, storage vendors are going to have an even more challenging road ahead to differentiate their offerings. As it stands, nearly every mainstream vendor has a distinct cloud play but distinguishing one from the other takes some serious research in some cases.

This is not the case with some companies who have unique offerings that have been built to serve the needs of growing virtualization. The Wall Street Journal pointed to one such storage startup, Nexenta Systems, which might be poised to garner some serious business and recognition during the storage shakedown in coming years.

As Cari Tuna stated, there are several telecommunications companies aiming to topple Amazon’s robust cloud market share but Nexenta is one startup that is making it possible for them to keep their pricing competitive enough to do so. By setting its sights on the one layer of the computing stack—the data storage software layer—it could be possible for others to encroach on AWS turf.

As Tuna reported, the special sauce behind Nexenta’s offering is as follows:

“The software can run on basic server systems from any hardware vendor. That makes the startup a competitor to both storage behemoths such as EMC, which sells hardware-software systems, and providers of on-demand computing resources such as Amazon, which uses storage software it built in house to maximize the capacity of its gear.”

Some big telecoms are seeing big benefit to this added competitive advantage, including South Korean telecommunications giant KT. The Asian company is gearing up to announce their own utility computing services that are powered by Nexenta’s software to help them remain competitive with Amazon’s pricing.

In fact, given that telecoms are suffering due to decreased traditional services and thus have been looking to become cloud computing providers, some could say that Nexenta’s timing couldn’t be better.

According to KT, Nexenta’s software will allow them to undercut Amazon pricing, although it might be difficult to see at first given the different pricing models for the two service providers. To highlight the difference, they note that “a customer might rent one basic virtual server from KT for 43,000 South Korean won, or around $38.50 per month. According to Amazon’s website, its basic virtual server costs $0.095 to $0.10 per hour for Asia-Pacific customers, or $68.40 to $72.00 for 30 continuous days of usage.”

Full story at Wall Street Journal Blogs