I just got back from my nth Flash Memory Summit. Special thanks to Tom Coughlin and the crew for putting on a good show and providing an excuse to get together with my friends in the industry.
I have some observations from the show this year:
1. There is nothing quite like a multi-billion dollar industry threatened by extinction to generate new breakthroughs, and 3D NAND technology looks like just the technology to extend the life of NAND flash for many more years. This means we can continue to project out density and cost improvements with NAND flash even as 3D NAND makes dealing with wear levelling a little bit easier for a generation or two.
2. We have been saying for years that “in five years” we would have a technology that could displace NAND flash. It looks like we will continue to be wrong, but the new announcement from Micron about 3D XPoint is nonetheless exciting because it may be our first viable storage class memory. There are a host of things people would like to do with NAND flash but they can’t because NAND is too slow to act as memory, or that they would like to do with RAM but RAM is volatile and low density. 3D XPoint appears to be a product that will enable some clever engineers to reach some markets poorly served by NAND flash.
3. Coincidental to the show, Pure Storage filed for a public offering. The financials that accompanies their filing made me pause and reflect that building a company to launch today is very different from building a company capable of long-term survival. At Texas Memory Systems (TMS), we did business the old fashioned way – we were profitable. The CEO never took on venture capital or long-term debt. His business could have continued indefinitely. The obvious downside of our approach at TMS was that we could not buy market attention and market share. To be relevant in our marketplace we had to produce the best technology. To be interesting to IBM, TMS had to have the best engineering. Now, it seems that the other start-ups in the industry that attempt to develop sustainable business models are mocked rather than celebrated. I think a few more market disappointments and with any luck we will learn to value businesses that build for a future. I believe the companies that are built to survive are better acquisition candidates.
4. The all-flash array market continues to be vibrant and fast growing. Even dropping $100 million from the 2014 market size estimates still shows a market in the early stages of spectacular growth. Just as interesting, we are starting to see companies aim for the edges of the market and position for promising new niches. The long awaited takeover of the data center by flash is well underway.
My final word of wisdom from this journey is that you should never take a cab from SFO to Santa Clara.