What do you consider Drobo's value proposition?
The company was founded with premise that storage is too hard, too complicated and is one of the most important computing assets that you need these days but has never been simplified. The premise was to make it the best data storage experience ever, dovetailing on the fact that most people don't love their storage devices. They've had complexity issues with it, reliability issues with it, they rely on it more and more now for personal digital or business digital assets, and they've just not had a love affair with their storage device for one reason or another. And we think there's a lot of innovation to be hard in the storage arena to make storage easier to use and less intimidating, especially to individuals and small and medium businesses.
Who's using Drobo?
We have about 120,000 units with customers now. We started with high end prosumers in the photo and video market, and have had recent offerings more in the small office home office (SOHO) and SMB arena. We're not an enterprise play, but we find ourselves in lot of enterprises. Not data centers, but departments, test labs, video editing kind of stuff, a lot of executives have us.
The secret sauce is our BeyondRAID technology, which is basically an innovation to protect data in an easier and safer manner. That software allows us to build products that are easier to manage and easier to use. It allows you to mix and match drives, so you can buy SATA drives from any vendor. Our systems recognize capacity instantly, nobody else can do that. We handle disk drive failures quickly and elegantly. The bottom line is you don't need to be a storage jockey.
It's actually very complicated engineering. The interface for customers is very simple. It's a red light, green light, yellow light interface, so you know the product is working as it was designed to, or if it needs some help. When you get a different colored light, it tells you what to do. We don't give a thousand choices and a thousand features. We just design the product to run reliably, to self-correct when there are any data problems, and to upgrade on the fly. RAID systems today can't do that.
So why go beyond RAID?
RAID was invented in 1984. It became a hit in the storage market and it's been the data protection standard for 25 years now. In 1984, by the way, Apple introduced the first Macintosh. Apple innovates. They've gone from the first Mac to the iPad. That's an amazing range of innovation. RAID is the same data protection scheme, plus and minus a few features, over the last 25 years. When it was contemplated in 1984, nobody ever imagined the amount of digital data out there, the amount of storage arrays out there, how many home and small businesses would be relying on digital data and the need for simplicity. It just was not designed for that.
So the Mac's 25 years old and now we have an iPad, and RAID's 25 years old, and it's still RAID. And the way we use storage today is a lot different than the way we used storage 25 years ago.
Do you intend to move more into business-grade storage?
We started low in the product line and moved up with the Drobo Elite and DroboPro products that are more targeted for business users. We've recently been certified by VMware and Symantec, and we work closely with those folks to provide solutions for SMBs as well.
How high can you go with the same architecture? Will you top out as SMB level storage?
It turns out the architecture doesn't have any theoretical limits. You can go to more drives and bigger boxes; it's just a matter of us finding that sweet spot. Right now it turns out that market is between $300 and $10,000, and that's a market that's been ignored by the big storage vendors. Although the architecture can get to enterprise, I don't consider us an enterprise play right now.
Isn't there more competition in that space now than when Data Robotics started? Where do you stand in relationship to other prosumer/SMB storage products from vendors such as Buffalo Technology, EMC Corp., Iomega and NetGear?
They're out there but they end up being a different solution. Most of our products are direct attached storage (DAS). Four of our five products can be direct attached, or iSCSI attached to a storage area network (SAN). All the products you mentioned are network-attached storage (NAS) products. We recently introduced the DroboFS, which is a file sharing product that will target the guys you mention in easier Drobo-like fashion. But most of our products don't go head to head with those guys because they're networked attached storage and we're more direct attached and iSCSI.
Why go the other way?
Market research shows that iSCSI and direct attached storage are the fastest growing segments of these price points. We only got into file sharing market couple weeks ago with DroboFS. We don't call it NAS, we call it file sharing with Drobo.
Research also shows file storage is growing faster overall than block.
That's an enterprise statement, though. That's absolutely true in the high-end enterprise. In small offices where you're running Exchange or running behind VMware or doing backups, a lot of it's still direct attached and block storage. There's some file sharing of course, but that's where we end up playing.
Are those the main applications customers are using Drobo for?
At the low end there's a high affinity with Apple users. A lot of media storage and consolidation, video, Adobe Final Cut Pro customers, that's the low and midpoint of our product range. When you get to the Drobo Pro and Drobo Elite, it's a lot of 100-person companies running Exchange, maybe they have some virtual machines in there, and we're primary storage in some cases or secondary storage doing simple iSCSI backups with Backup Exec or Microsoft or VMware tools.
What specific value do you bring to people running virtual servers?
We're simply an easy to set up block storage device. We don't do anything that would complicate the life of a virtual server. We're just a block iSCSI target device for primary use or secondary use for backup. We just present ourselves as a big piece of block storage that is very failure resistant and redundant and easy to manage. If you want to run snapshots or replication on us, you can do that with your own tools, but think of us as an easy, affordable piece of storage.
Your architecture may be simple, but you already have five different products. How do customers know which one they need?
Drobo is desktop storage for everybody. The Drobo S is much higher performance for Drobo, you get five times the performance and it's more for people doing video editing. The FS is file sharing, that has the Ethernet port, and you can share files over office or home office. The Pro is more of a single host or iSCSI backup solution for VMware or Symantec, and the Elite is your Exchange or email product, or it could be backup for multiple hosts. They do have clear delineation but yeah, we have to train people now, they're used to one Drobo and now we have five.
What's your software strategy for data protection, snapshots, management, and so on?
We use mostly third parties. We have a built-in tool called DroboCopy. It's a super simple backup product, not a super enterprise class remote replication kind of deal. We rely on partners for that, like Vizioncore and a lot of the VMware and Microsoft tools. We're not out there to reinvent how to do snapshots. There are people who know how to do that, so we just work with those products.
Will we see more Drobo products this year?
Our technology scales up and down, so it's a question of how we want to package the technology for important use cases for SMBs. We're not going after enterprises. We don't need to fight that battle. We think the high end prosumer and SMBs is where our value proposition resonates.
Your predecessor, Drobo founder Geoff Barrall, last year talked about Drobo being close to break-even. Can you give an update on that?
We're growing fast and we're investing in growth. What Geoff said is not untrue, but I don't want to go into specifics on that. I'll say we're on target with all our financial plans. We have to grow internationally a little bit, we have a bigger product line now, and we're trying to grow the place. We're about 80 people worldwide, we have an office in the U.K. and Singapore. But I won't share specifics on the company now.