The computer storage sector develops tape, optical, and magnetic storage and retrieval equipment for computer platforms. These equipment range from the standard desktop computer floppy and hard disk drives to unique storage administration systems such as advanced tape library and autoloader systems implemented in sizable enterprise networks.

Demand for more storage capacity and speed has risen quickly, as microprocessors have evolved faster, software applications require more computer resources , and network computing has become more of a standard. Attempts to augment processing power and give users greater features have made the standard new software application consume vastly increased storage space than previous versions. On personal computers, storage expectations have further grew and multiplied as a consequence of rising multimedia features and content, like DVD movies and downloadable music on the Internet. Meanwhile, corporate systems have been required to contend with expanding storage and processing requirements from internal users, and additionally from the Internet.

Cargo values for computer storage appliances and equipment like tape libraries, which equaled $9.0 billion in 2000, went down to $8.2 billion in 2001. At that time, about 66 companies competed in the domestic market. Even during the multiple forces invigorating demand for storage devices, the industry, like many computer hardware sectors, has been adversely affected by aggressive price competition. Such pressures have brought significant consolidation inside the industry and have prompted cost controlling at several storage device firms. In conjunction with increased price competition, the market for storage devices was at the mercy of a weak economic climate in the early 2000s. This laid out challenges across practically every product sub niche in the computer industry, as manufacturers faced lowered spending and certainty levels in both the consumer and corporate sectors.

The computer storage industry continued to meet both issues and opportunities related to storage outsourcing services, or storage service providers, or SSPs, at the beginning of 2000s. These remote services sell storage space and management products that clients can simply connect to and use, permitting companies to avoid acquiring and running storage hardware and software themselves. At the beginning of 2000s, the new SSP field was modifying how storage devices are applied and marketed. It also presented an opportunity for storage equipment companies to branch into services. By 2001 telecommunication corporations like World Com and AT&T were involved in this sector. Across the world, IDC, a company specializing in technology intelligence and industry forecasts, forecast spending on SSPs to go up from $150 million in 2000 to $10.5 billion in 2005, as reported by Computing Canada. This growth reflected a compound annual growth rate of over 134 percent.

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