Open Letter to Kevin Hunt re FIO Analysis


Your recent comments regarding FIO are off the mark, in my opinion.  The competition in the enterprise is, so far, non-existent; ask anyone at the end-users or even at the mftrs.  Can you find EVEN ONE data center to stand up and say we have a 2nd source w/ Virident?  OCZ?  TMS?  Or you can go direct to LSI, OCZ, Virident:  where has anyone developed even one relationship (OEM or end-user) or sold even one device to a major data center?

You keep saying there is pressure on FIO — but where is it coming from?  I think it comes from Violin, Exadata, etc — perhaps Solidfire, Nimbus.  But even Kaminario and Schooner use FIO inside  — so the appliance v. PCIe argument is less meaningful.

I think FIO shot itself in the foot this qtr — as a young company it really does not know how to manage expectations yet.  More importantly, the market is blue ocean and highly unpredictable.  But in the meantime, they are growing (incontrovertibly) to $100m per qtr.

I think you will agree that they are looking at something north of $350m for the FY.

And, at the same time, they are sucking the oxygen out of everyone else’s fire.  ioTurbine and ACM are truly disruptive — it takes time to get the message out, show the value, funnel the sales efforts.

The margins will come back — we both know this — and when they do, FIO is $40 and beyond.  They really ARE the next VM, DDUP, Riverbed — you name it.

I am a former employe and long FIO.

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