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Vendors Overcharging for SSDs and HDDs?

Vendors Overcharging for SSDs and HDDs?

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This morning I read an article on search storage’s Storage Soup blog that talked about the cost of SSDs and the amount of money made by storage array vendors as they mark up SSD vendor drives.  STEC were the main target of the article after discussing SSD adoption in their recent earnings call.

Whilst I have no doubt that storage array vendors are making a good markup on SSD bulk prices and could be constricting growth in the market, I also doubt this is a new phenomenon.  Have a look at the list price per drive of any array vendor and you’ll see SATA and SAS drives similarly marked up .

Some of the increased cost can be attributed to maintenance cost – if a drive fails in the maintenance period, if gets swapped FOC by the vendor – and some of the cost is no doubt related to development work around integrating and testing each drive manufacturer’s product.  However the remainder is naturally profit, at a level sustained by the market.

If you feel your array vendor of choice is charging too much, then you have two choices; (a) bring in a multi-vendor policy and drive your costs down or (b) buy the raw devices and “build your own”.  You can do this today with products from vendors such as Nexenta, and as I will discuss in my next post, now from Fusion-IO.  BYOSA (Build Your Own Storage Array) may not be everyone’s choice, but choice there is – so there’s no need to complain about the raw drive prices – especially if you are the drive vendor itself.

About Chris M Evans

  • Dave

    Yes but it is insane that in some cases it is cheaper to buy a new array then to buy bigger drives due to the markup. Dell is particularlly guilty of these. They often have 700% markups (or more) on their drives compared to retail price from a thrid-party source. I appreciate and expect them to charge more for the burn-ins, and CODB, but 700%??? Don’t get me started on SSDs. Those are astronomical if purchased from Dell. In fact cost prohibative for all but the most cash rich organizations. In our shop, they have lost sales because of it.

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