European IT managers expect budgets for storage spending to remain at least at 2003 levels, with spending focused on more efficient disaster recovery systems and greater disk capacity.
A report from analyst IDC, which surveyed 530 IT managers from both large and small companies, shows the benefits of storage management software are still struggling to compete with the appeal of cheap disks.
According to IDC, nine out of 10 respondents expected to see spending on storage maintained or increased this year.
Asked where they would be making investments, respondents cited improved data recovery as their top priority, followed by additional capacity, speeding up the ability to restore from backup, and automation of storage management.
This is a change from the past couple of years, which have seen storage management take precedence over increased capacity, according to Claus Egge, programme director for European storage systems at IDC.
"Capacity is perceived as being cheaper right now, with the hardware guys shipping more boxes but not making any more money," he said.
Jason Rabbetts, managing director of VAR Source Consulting, said people are definitely looking at capacity again.
"Four years ago everyone went mad and had lots of spare capacity, then couldn't manage it," he said.
"Now they are getting their house in order and have got to the point where they are at the end of not spending anything."
Rabbetts added that it is promising that spending remains the same, because equipment has devalued, so growth and capital expenditure is outgrowing the commoditisation process.
But Egge claimed it is too soon to predict an upswing in spending. "I'll be waiting for the first-quarter spending figures, and if they show sequential or year-on-year growth, I might start to share the optimism," he said.
Paul Sangster, managing director of storage distributor Hammer, said: "We are seeing signs of a recovery. Hammer increased its profitability by 100 per cent on last year. Storage is still the place to be because data is the most important part of any company."
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