IBM Disk Storage Systems Achieves Double-Digit Worldwide Revenue Growth, According to Leading Research Firm

Market Wire, December, 2005

IDC reported today that in the third quarter of 2005, IBM gained revenue share and achieved double-digit year-to-year factory revenue growth worldwide in overall and external disk storage systems [1]. IBM built upon a strong performance during the first two quarters of 2005 and continued to expand its revenue growth in overall disk storage systems over the competition during the third quarter.

Led by 20 percent year-to-year growth in worldwide external disk storage systems revenue for the third quarter of 2005, IBM's year-to-year growth in revenue was higher than that of four of the top seven storage vendors. Additionally, in worldwide combined internal and external disk storage systems revenue, IBM achieved 20 percent year-to-year revenue growth.

"IBM's continued focus on delivering solutions that improve each client's information infrastructure is a key reason for our growing success," said Kristie Bell, vice president, IBM Storage Systems. "Adoption of IBM's DS8000 and DS6000 systems has been tremendous. IBM's growth in the midrange segment was more than ten percentage points higher than the overall segment, further evidence that our clients recognize the power of IBM's open and unified storage approach that delivers lower cost of ownership." [2]

In both North America and the Asia-Pacific (including Japan) region, IBM's revenue for external disk storage systems each grew by double digits, outpacing the segment's overall growth rate in those regions.

--  In North America, where industry revenue grew 13 percent overall,
    IBM's external disk storage systems revenue growth rate was 31 percent year-
    over-year;
--  And in the Asia-Pacific region (including Japan), which grew 7
    percent, IBM's external disk storage systems revenue growth was 18 percent
    year-over-year.
    

In the worldwide UNIX-attached total disk storage systems segment, which grew just over 4 percent overall, IBM experienced 20 percent year-to-year revenue growth to achieve the number one position.

About Information on Demand

The desire by businesses to access, manage, deliver, secure and store information more efficiently is driving rapid change in the IT marketplace. Traditional low-tech, hardware-only approaches by proprietary vendors are meeting with resistance as companies grappling with new government mandates and business demands strive to capture and integrate information in a more seamless, real-time fashion across the enterprise. IBM's information on demand approach combines deep business insight with open standards, advanced storage systems, and sophisticated software for information, security and IT system management to create cost effective and flexible information infrastructures. Regardless of industry, IBM helps companies transform data into insight to enable information on demand.

About IBM

IBM is the world's largest information technology company, with 80 years of leadership in helping businesses innovate. Drawing on resources from across IBM and key IBM Business Partners, IBM offers a wide range of services, solutions and technologies that help enable customers, large and small, to take full advantage of the new era of e-business on demand. For more information about IBM, visit http://www.ibm.com.

[1] Source: IDC's Worldwide Quarterly Disk Storage Systems Tracker Q3 2005.

[2] Midrange market includes IDC price bands 5 and 6, including storage systems priced between $50,000 - $299,000.

Contact: Mike Darcy IBM 914-588-8355 mdarcy@us.ibm.com