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Consumer Network Attached Storage Market Growing, But Continues to Face Significant Challenges, According to ABI Research

October 29, 2008

Network Attached Storage, or NAS, is slowly finding its way into homes as consumers look for convenient ways to back up their growing libraries of digital media. While backup is the primary focus for many, the ability to serve media around the home using a centralized storage device is also a key focus for many vendors in this market.

“The widespread popularity of direct attached storage such as USB hard drives is a testament to the growing realization among many consumers that backup is a necessity,” says ABI Research director Michael Wolf. “As many direct-attached hard drive vendors begin to make dual-purpose USB hard drives/NAS drives or try to upsell consumers directly to NAS, we expect that some consumers will look to implement centralized whole-home solutions.”

The consumer NAS market is not without its challenges. Consumers accustomed to the plug-and-play simplicity of USB hard drives or flash drives may be discouraged by the greater complexity of network-based solutions. The high return rates for early NAS products is a sign that many consumers need to be further educated, while an increased focus on installation and ease-of-use from vendors will be a requirement if they hope to further expand into the market currently dominated by direct-attached storage.

“Most consumer NAS vendors today utilize DLNA capabilities, which serve the dual purpose of easier discovery and installation as well as giving consumers potential media server for their homes,” adds Wolf. “As consumer NAS products continue to drop in price (some can be found below $100 today) we will see crossover from consumers looking for backup solutions to move to NAS. The keys will be for the products to be well-engineered and for the vendors to educate their consumers about exactly what they are getting and how to use it.”

ABI Research’s new study, “Consumer Network Attached Storage” (http://www.abiresearch.com/products/RR/NAS) examines the market for consumer network storage devices, alternative storage technologies, and opportunities for network storage to increase market penetration. Forecasts are provided by NAS market segment as well as geographic region. A forecast is also provided for NAS on Chip (NASoC) processors.

It forms part of the firm’s Home Networking Research Service (http://www.abiresearch.com/products/service/Home_Networking _Research_Service).

ABI Research is a leading market research firm focused on the impact of emerging technologies on global consumer and business markets. Utilizing a unique blend of market intelligence, primary research, and expert assessment from its worldwide team of industry analysts, ABI Research assists hundreds of clients each year with their strategic growth initiatives. For information, visit www.abiresearch.com, or call +1.516.624.2500.

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