Prospectus Summary
This summary highlights information contained elsewhere in this prospectus and does not contain all of the information you should consider in making your investment decision. You should read this summary together with the more detailed information, including our consolidated financial statements and the related notes, elsewhere in this prospectus. You should carefully consider, among other things, the matters discussed in “Risk Factors.”
ISILON SYSTEMS, INC.
We are the leading provider of clustered storage systems for digital content. As more information is recorded and communicated in images and pictures rather than text and words, the volume of digital content — which includes video, audio, digital images, computer models, PDF files, scanned images, reference information, test and simulation data and other unstructured data — is growing rapidly. Enterprises are utilizing this digital content to create new products and services, generate new revenue streams, accelerate research and development cycles and improve their overall competitiveness. Recognizing the growth and importance of this type of data, we designed and developed our clustered storage systems specifically to address the needs of storing and managing digital content. Our systems are comprised of three or more nodes, with each node a self-contained, rack-mountable device that contains industry standard hardware, including disk drives, central processing unit, or CPU, memory and network connections, and is integrated with our proprietary OneFS® operating system software, which unifies a cluster of nodes into a single shared resource. To date, we have sold our clustered storage systems to more than 200 customers across a wide range of industries.
Digital content has many characteristics that differentiate it from traditional structured data, such as text and databases. These characteristics include larger file sizes, rapid and unpredictable data store growth, the need for multiple simultaneous user access, and the need for high levels of data throughput, and create challenges for traditional storage systems. The challenges of storing and managing large amounts of digital content are common across a number of industries, including media and entertainment, Internet, cable and telecommunications, oil and gas, life sciences, manufacturing, and the federal government. For example, in movie production, 10 seconds of high-resolution digital footage can require up to 12 gigabytes of storage, and in cancer research an image of a single drop of blood analyzed by a mass spectrometer can create over 60 gigabytes of data.
The worldwide market for external disk storage systems will grow from approximately $17.4 billion in 2005 to approximately $22.7 billion in 2010, according to estimates from International Data Corporation, or IDC. The market for storage systems dedicated to digital content is estimated to grow at a much faster rate. According to the Enterprise Strategy Group, or ESG, certain industries including multimedia, oil and gas, scientific research, healthcare, personal Internet services and software development will experience rapid growth in file-based storage capacity. For example, in disk-based digital archiving, which is one portion of the market our systems address, ESG forecasts that the demand for storage capacity will grow from 377 petabytes in 2005 to nearly 11,000 petabytes in 2010, representing a 96% compound annual growth rate, with the substantial majority of this stored information comprised of unstructured content, such as office documents, web pages, digital images and audio and video files.
Our Isilon IQ clustered storage systems enable customers to scale incrementally as their storage needs grow by purchasing additional nodes to increase storage capacity, performance or both. Our clustered storage systems deliver significant benefits to our customers, including:
End box 1 END LOGICAL PAGE PAGEBREAK BEGIN LOGICAL PAGE Begin box 1 performance and reliability using industry standard hardware, which we believe is more cost-effective than alternative solutions.Our strategic focus is to enhance our position as the leading provider of clustered storage systems for digital content. Key elements of our strategy include:
Risks Affecting Us
Our business is subject to numerous risks, which are highlighted in the section entitled “Risk Factors” immediately following this prospectus summary. These risks represent challenges to the successful implementation of our strategy and growth of our business. Some of these risks are:
End box 1 END LOGICAL PAGE PAGEBREAK BEGIN LOGICAL PAGE Begin box 1For further discussion of these and other risks you should consider before making an investment in our common stock, see the section entitled “Risk Factors” immediately following this prospectus summary.
We were incorporated as a Delaware corporation on January 24, 2001. Our principal executive offices are located at 3101 Western Avenue, Seattle, Washington 98121, and our telephone number is (206) 315-7500. Our website is www.isilon.com. The information on, or that can be accessed through, our website is not part of this prospectus.
Except where the context requires otherwise, in this prospectus “Company,” “Isilon,” “we,” “us” and “our” refer to Isilon Systems, Inc., a Delaware corporation, and where appropriate, its subsidiaries. Isilon®, Isilon Systems®, OneFS®, Isilon IQ, SyncIQ, SmartConnect, TrueScale, Isilon Insight, AutoBalance, FlexProtect-AP, SmartCache, WebAdmin, Isilon IQ Accelerator and Isilon EX 6000 are trademarks of Isilon. This prospectus also includes other trademarks of Isilon and other persons.
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