IBM Posts Double-Digit Revenue Growth in External Disk Storage Systems, Outpacing Overall Marketplace, According to Leading Research Firm

Market Wire, December, 2006

IDC's Worldwide Quarterly Disk Storage Systems Tracker shows IBM's (NYSE: IBM) external disk storage revenue growing significantly faster than the overall storage marketplace for third quarter 2006, growing revenue 14.3 percent year-to-year, compared to the overall external disk storage marketplace, which grew at 9.9 percent [1]. IBM increased its revenue share year-over-year, and according to IDC, IBM grew revenue faster than Dell, Hitachi, and HP, all of which lost revenue share.

IBM's results were highlighted by strong growth in regions throughout the world, led by Asia Pacific regions, excluding Japan, where IBM's 52% year-over-year gains were the highest for any disk storage systems vendor, moving IBM from third to first in those regions overall. That growth also moved IBM ahead of HP and EMC for revenue share, as IBM gained 6 points of share in those regions. IBM also posted strong growth in Europe, making it the fastest growing of the three top vendors in Europe. IBM is also the number-one external storage vendor in Latin America with a 31.2% revenue share.

"IBM has consistently outpaced the overall growth of the storage market by delivering products and solutions that help our clients solve their toughest storage challenges and help them manage their information on demand needs," said Kristie Bell, vice president, System Storage. "IBM's momentum is driven not just by disk storage, but by delivering the industry's widest portfolio of hardware, software and tape storage offerings, including the DS8000 Turbo, the IBM System Storage TS1120, the world's first tape encryption drive; and SAN Volume Controller, the leading storage virtualization product."

IBM continues to expand its presence with the introduction of new storage products and solutions. In November, IBM extended its relationship with Network Appliance (NetApp) by introducing a new unified storage system, the N5600, as well as expanded virtualization interoperability and database backup software. Earlier in the quarter, IBM announced an expansion of its enterprise line of disk arrays, including the introduction of a new flexible choice warranty option, while also adding new models to its enterprise tape portfolio that includes support for the world's first 700 GB physical capacity linear tape media.

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

For more information about IBM and IBM storage, visit http://www.ibm.com/storage .

[1] Source: IDC's Worldwide Quarterly Disk Storage Systems Tracker Q3 2006

Mike Darcy IBM System Storage 914-766-4777 mdarcy@us.ibm.com