The Internet has revolutionized the way corporations do business and created a world in which the average consumer regularly turns to the Web for information, services and entertainment. As a result, more data is being stored and transmitted than ever before, putting data storage at the heart of this revolution and making two trends particularly significant.

The first is the entry of the consumer as an IT user through the Internet, which has fueled the development of a new business model--e-commerce. The emerging confluence of digital communications and information processing using the Internet and private networks is driving an explosion of new uses and forms of business interaction. Transaction and record data, images, sound, and videos must be stored for fast access and archived for historic reference. New applications--such as data warehousing, data mining, on-line transaction processing (OLTP), and multimedia browsing--stimulate the need for large storage capacities because these applications require the replication of data, the creation of new data sets, and the movement of large files across multiple platforms.

The second major trend is the outsourcing by corporations of several of their IT applications, which has fueled the development of e-services. E-services, made possible through the convergence of technological advances in computers, networks, telecommunications, and storage, are triggering a transformation and imposing new challenges on data. This "service-centric" model will have ripple effects throughout our daily lives, and change the way business is conducted.

We can already see this paradigm shift driving demand for higher levels of storage availability, performance, connectivity, scalability, and manageability--all at a reasonable price, of course.
These are only the first signs of a bigger revolution. Internet is in its infancy, and development work is underway to overcome its bandwidth limitations (cable, wireless, DSL). Major changes in telecommunications infrastructure and pricing, combined with generalized use of digital consumer electronic devices such as PDAs, Palm Tops, set-top-boxes will fuel a surge in internet access and utilization, and drive an unprecedented demand for storage and bandwidth.

We are two years away from having millions of people owning a set-top box-like appliance with more than 100GB of storage capacity. Imagine the number of requests to a single Web site! Imagine the amount of data each organization must be able to serve up, seemingly instantaneously! To prepare for this eventuality, you need to know about the services that are springing up to address some of these anticipated data storage needs--application service providers, storage service providers, and co-location services. You also need to know about developments in the online data storage arena as well as in network storage and near-line and offline storage. Finally, you need to know what storage management software is--or will be-- available to your enterprise to help manage all this data storage.

Statistics 1

· ~ The percentage of Americans online has risen from 14 to 41 percent in three years.
· ~ In1999 the volume of email in the U.S. surpassed the volume of hand-delivered mail.
· ~ By the end of 1999, 3 million U.S. households had online accounts, with $374 million in assets. In 2003, 9.7 million households will have online accounts totaling $3 trillion. (Forrester Research)
· ~ Companies did $43 billion in business with each other over the Internet in1998. By 2003, this volume will rise to $1.3 trillion, accounting for 9.4 percent of total business-to-business sales. (Forrester Research)
· ~ By 2002 the number of computers connected to the Web outside the U.S. will more than triple, to 61 million (compared to 50 million in the U.S. today). The fastest growth is in developing nations. (Dataquest)
· ~ In Japan, Web use has grown from 1.5 million people to 17 million in four years. Some 11 percent of households and 80 percent of large corporations are online.
· ~ While it took Citibank 10 years to ramp up to 75TB of storage, excite.com reached 49TB after two years, amazon.com purchased 42TB in six months, and mail.com built up 27TB of disk storage in just 45 days.

Statistics 2

~ Buying and selling on the Internet has become big business. Forrester Research estimates that more than $1 trillion in U.S. goods and services will be traded on the Internet by 2002. In 1999, e-commerce was already a $24 billion-a-year business. Consumer-only e-commerce is estimated to rise to $75 billion by 2003.
~ The number of e-business Web sites is expected to top 1 million by 2003, up from 700,000 in 1999. (IDC)
~ A study by Andersen Consulting indicates that more than 25 percent of the purchase transactions at online stores never go through.
[end sidebar 1]

Statistics 3

~ It is estimated that 50 percent of large companies are planning to outsource their e-commerce system development. In addition, the majority of these new businesses lack the necessary expertise in large-scale, distributed IT systems and are expected to outsource most or all of their IT needs and management.
~ United Airlines has announced its intention to outsource its entire email system to Internet messaging provider USA.NET. United is the first Fortune 500 company to outsource its whole messaging system to an Internet mail provider.
[end sidebar 2]

Statistics 4

~ Financial: It costs banks only 1 cent to process an Internet transaction, compared with 27 cents for an ATM transaction and $1.07 for a branch transaction.
~ Travel: It costs airlines $1 to process an e-ticket, compared with $8 for an agent-booked ticket. Jupiter Communications estimates that by 2002, online bookings will account for 62 percent of airline ticket sales while conventional ticket sales will account for only 20 percent.
~ Trading: Online trading is running at 37 percent of all retail trades. It's expected to hit about 50 percent by end of 2000 next year [2000 or 2001?].
~ Manufacturing: In 1998, companies farmed out 15 percent of all manufacturing. In 2000, they will outsource more than 40 percent. (Hambrest and Quist)
~ ASP: According to IDC, spending in the high-end ASP market will grow from $150 million in 1999 to more than $2 billion by 2003, representing a 91 percent 4-year compound annual growth rate.

By: Farid Neema

PERIPHERAL CONCEPTS, INC.
351 Hitchcock Way, Suite #B-200
Santa Barbara, California, 93105
Tel: (805) 563-9491
fneema@silcom.com

This article was published in the Marh issue of Windows2000 Magazine