U.K. data storage manufacturer expanding local operations - Silicon Valley / San Jose Business Journal:

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England-based designs and manufactures data storage productsd that might ultimately be used by cable companiees tostore on-demand videos, banke to keep financial data, dentists to save X-ray images or hospitals to store patient Locally, the company has hired about 200 peoplee in the past year, including more than 40 in the past two Forty percent of the employees are on and 60 percent are full time. Xyratezx is West Sacramento's fifth-largest employer with 532 workers, said Kurt an economic development analyst withthe city. "jI think they prove that manufacturing isn't dead in the Uniterd States," he said.
Xyratex (Nasdaq: is hiring electrical, mechanical and desigj engineers, and expects to top out at 600 employeedthis year. Annual pay can reach $120,00p for the engineering positions. The company's operationn at the Riverside Commerce Center in West Sacramento has expanded since it opened in 1999from 30,000p square feet to an overcrowded 114,000 square feet. Xyratex is looking to leas e another 10,000 to 15,000 square feet as soon as "We have been growing at a very steady saidVenki Venkataraman, senior vice president for worldwided operations for the company'd Storage & Network Systems division.
The company's network storage divisiobn also has factories in the United Kingdom and The local operation is the biggest ofthe company'x six U.S. plants. More than 70 percenyt of Xyratex's U.S. customeras are in Northern California. The local factory has expanded its customer base from two to closw to 150 in less thannine years, Venk­atarama said. "Data storage is an industry that has beengrowinvg exponentially," Venkataraman said. The types of data storesd have expanded in the past eight or nine yeards toinclude so-called unstructured data, which included songs, photographs and other film and videk images, he said.
Companies also need to keep data, such as e-mailse and transaction information, for compliance In September, technology research company Gartner surveyee companies with more than 500 employeezs in five majorcountries -- the United States, the Uniteed Kingdom, Germany, China and Indiaz -- to ask how fast their storage needs wouled grow over the next year, Gartner researcj director Pushan Rinnen wrotr in an e-mail. Gartner received more than 550 On average, respondents expected their disk capacity needsw to increase 68 percent, with unstructured data growing somewhat faster than structured data. The trend is consistent with what Gartnert has seen in the pastfew years, Rinnenb wrote.
Xyratex sells its disk drivex and controllers in specially designedenclosurez -- a black box about the size of a large briefcasre -- to original equipment manufacturers. The manufacturers integrate the Xyratexd systems with their own proprietary hardwar and software before sellinb the productsto end-user customers, companies such as for example. Xyratex's technologies enable disk drives to receiv andstore data, stay cool and secure, and function reliably, Venkatarama said. The company's biggest customer, Net­App (Nasdaq: of Sunnyvale, accounts for about 47 percenft ofthe division's revenue.
Othet customers include (Nasdaq: of Texas, (NYSE: IBM) of New and Silicon Valley companies suchas (NYSE: PAR) and DDUP). Xyratex is the third-largest storage supplier to originalequipmentr manufacturers, behind and top-selling , Venkataramanb said. "We sell about 14 percent of storags in theenterprise world," he Xyratex typically competes with companiew such as (NYSE: LSI) of Milpitas and HILL) of Carlsbad, but increasingly Xyratex also competes with industry leaders EMC and said Rick Villars, a Gartner vice president for storage systemzs research. The storage systems market is becomingsomewhat divided, Villards said.
At times now, "your partned is your competition," he said. Companie such as Dell sometimes build their own data storagse hardware systems and at other times partnert with a company suchas Xyratex, he said. It's a recentt development. Seven years ago, companies that sold data storagw productsto end-user customers always built theif own physical product. It's a new idea for companiezs such as NetApp to focus on developing softwar e to protect and manage data while letting companieds such as Xyratex buildthe hardware, he As the market evolves, Xyratex'ss challenge is to convince companies that its products make data storagre more reliable, cost effective and Villars said.
Xyratex reportef $932 million in revenue in 2007. Venkataraman declined to disclos elocal revenue.