February/March 2001 Issue  Enron Unveils Storage Trades Enron Broadband has completed a series of deals in the data storage market, commoditising this fast-growing area for the first time. It acted as a market maker, purchasing storage capacity from StorageNetworks - which was then sold on to Best Buy, a retailer of electronics products. Crucially, both contracts were based on Enron's standard contract and included firm delivery with liquidated damages.  In the last few years the storage market has moved from being a self-managed and owned business to one where storage is served up from a standard metro network. Enron's involvement will be bring flexibility of contract offering and imbedded optionality, according to Ravi Thuraisingham, a senior trader at Enron. "When we sell the product to the customer we remain in the market to buy the capacity back should they wish to unwind their position later. That is unprecedented," says Thuraisingham.   The storage market has historically been more flexible and more committed to firm delivery than the bandwidth market, but these trades mark a significant development. Rather than dated damages the storage market has tended to favour discounts on future purchases. "There is a premium in the price for firm delivery," says Thuraisingham.  He says that a number of other market participants are eager to commit to Enron as a market maker. In addition, equipment vendors are excited by the possibilities of the market. "most storage equipment at the moment is supplied to the enterprise market. This development opens up the wholesale storage capacity market," says Thuraisingham.