IBM’s Billion Dollar Bet
IBM (NYSE:IBM) is betting that flash storage will replace hard drives in the near future, and is backing it up with a $1 billion investment in research and development. While the claims about flash’s cost-effectiveness are disputed by many experts, IBM made its case for the technology while unveiling a new line of devices called FlashSystem at a New York press conference.
Most businesses rely on hard drives for storage, yet IBM is gambling that this inefficient service will be replaced in the near future by solid-state storage, which operates much faster and can handle larger workloads without sapping a great deal of energy. An IBM senior VP said Thursday, “There is no question that flash is the most economical solution to the business problem when…[it] calls for that class of technology.”
In fact, IBM appears to have been planning a move into solid-state storage platforms for some time. The acquisition of Texas Memory Systems (NYSE:TMS) last year gave the company access to arrays that were exclusive to the storage-pioneering company (TMS was selling its products as early as 2005). Now IBM is upping its game and opening 12 centers for flash systems development along with its new products.
While some industry experts claim that flash isn’t quite ready to be the cost-effective alternative, IBM is saying they are ready to back it up. Companies that stripe data across multiple disks can spend at minimum $10 per gigabyte and up to $50 per. The FlashSystem can do the job at $10 per gigabyte. The savings are compounded when looking at the energy consumption — or lack thereof — involved with solid-state storage.
IBM had a client at Thursday’s press conference to back up that claim. Karim Abdullah, Director of IT Operations for Sprint (NYSE:S) noted that his company’s use of electricity has dipped some 1.5 percent since implementing flash drives for storage. Competition is stiff in the department, but the major investment — plus the technology inherited from Texas Memory Systems — could be the boost IBM needs to get out ahead in solid-state storage.
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