With customers across myriad segments transitioning from the traditional ‘build-it yourself’ infrastructure to converged ‘ready-to-use’ infrastructure, the converged infrastructure industry is looking forward to high growth in the year 2015
Converged infrastructure Industry, which provides solutions that are made by bonding of server, storage, networking, virtualisation and at times few other resources into an integrated system that is holistically managed, has gained lot of momentum during the past few years. The enterprises today are moving towards solutions, which offer easy alignment with the legacy systems and offer greater agility, security, simplicity and scale.
The converged infrastructure industry is now in position to provide economic, technical and business benefits over siloed servers, storage and networking resources.
There has been an exponential increase in the worldwide spending on converged infrastructure. According to IDC, the spending on such infrastructure is likely to touch $17.8 billion in 2016. The converged infrastructure market has gained significant traction in India over the past few years. The market situation here is in line with the global trends. According to the Gartner, India will be the second largest market and also the second fastest growing market for data center infrastructure in the Asia-Pacific region.
Betting on High Growth
In 2014, revenue from data center infrastructure market in India that comprises of server, storage and networking equipment was $1.92 billion. It is likely to see a 5.4 percent increase to $2.03 billion in 2015, according to the research firm Gartner.
“The year 2014 has been a crucial year for the converged infrastructure. There has been greater acceptability of what IDC describes as the 3rd platform technologies – Cloud, Mobility and Internet of Things, which have led to the emergence of new demands in various IT segments,” says Manish Gupta, Director, Enterprise Solutions Group, Dell India.
“The converged infrastructure market has gained significant traction in India over the past 12-18 months. Based on the IDC Datacenter Economies Index, commissioned by VMware, the positive economic impact that virtualisation is likely to have in the Indian market by the year 2020 is about US$5.5 billion,” says Murad Wagh, Sr. Manager—Systems Engineering, VMware India.
Abhijit Potnis, Director Technology Solution India & SAARC, EMC points out that there has been significant growth in converged infrastructure market across the globe. This growth is quite visible in VCE revenue in last 2-3 years of close to $2 billion. According to IDC, globally converged infrastructure will account for 12.8 percent of total storage, server, networking and software spending by 2016, up from 3.9 percent in 2012.
The Key Drivers
The key drivers for the converged infrastructure industry are factors such as high adoption of cloud, more bandwidth utilisation in data centre, high operating costs and high adoption of virtualisation.
Dell India’s Manish Gupta points out that the key concerns for most customers include trends such as big data, mobility, BYOD, cloud computing and software-defined everything. In the coming year, these things will have a seminal impact on the data centre space. “Converged Infrastructure solutions are being deployed by SMBs and large enterprises as an alternative to building an expensive data centre,” adds Gupta.
Abhijit Potnis of EMC is of the view that the two aspects that are driving the demand consist of factory integrated converged infrastructure and reference architecture based converged infrastructure. He also informs that the maximum amount of convergence is happening in greenfield nbso online casino reviews projects such as virtual desktop.
“Some of the large enterprises are asking for factory integrated converged infrastructure but lot of demand is coming from reference architecture based converged infrastructure,” adds Potnis.
There is a demand for operations which deliver performance, saves time, optimise costs, save power and enable automation of the processes. According to VMware’s Murad Wagh, Industry is witnessing the trend of customers across segments transitioning from the traditional ‘build-it-yourself’ infrastructure to converged ‘ready-to-use’ infrastructure that allows IT to deliver faster results and focus on innovation rather than just keeping the lights on.
More and more organisations are expecting support from a single source on all components of the data center including virtualisation, compute, storage and networking, as it helps organisations drive down operational costs related to siloed management of infrastructure. In fact, this seems to the key driver of growth for the segment in the past, and this trend is likely to continue in 2015.
Technology Trends
The currently market trends clearly indicate that the sector has recovered significantly from the low of 2008, when there was a global recession, and now we are in a period of high growth. But the sector also faces many challenges. There are the budgetary pressures. According to Forrester Research, most firms are allocating 50 percent of their IT spending to the cost of maintaining ongoing operations, systems, and equipment. Less fund is being deployed for executing new projects.
Som Satsangi, Vice President, Sales, Enterprise Group, HP India, says that when there is unparalleled growth happening in the industry in terms of data volume and velocity, the IT organisations have to find ways to overcome the budgetary challenges for implementing the right kinds of solutions.
The innovations in the areas of cloud, mobility and IoT are fuelling the demand and setting the trends in the IT sector. Four broad types of convergence — general purpose integrated infrastructure, application specific building blocks, module building block and hyper rack-space — are evolving.
“Customers typically choose between purchasing rack or blade servers, networking and storage individually for building the foundation of their data center operations,” says Manish Gupta of Dell India.
“Hyper-Converged Infrastructure Appliances (HCIA) is the next wave that will simplify and hasten the delivery of application workloads even more. HCIA is a scalable SDDC building block that delivers compute, networking, storage, and management to empower private/hybrid-cloud, end-user computing, testing/development, and branch office environments,”says Murad Wagh of VMware India.
CIO’s and Convergence
CIOs’ need real time analytics on live transactional data in a highly secured environment. According to Gartner, in 2016, 82% of server workloads will be running in virtual environments. Previously enterprises and CIO’s used to buy hardware and software from different vendors and rely on a third party solution provider to join them together and create useful solutions. However, now there is change in the way of doing things.
“Today, with the overwhelming amount of data and the need for immediate turnaround time, CIOs are looking for applications and systems that enable them to turn increasing amounts of data into actionable intelligence and strategic insights while keeping their costs to minimum,” says Som Satsangi of HP India.
According to Murad Wagh of VMware India, CIOs today have a choice from the perspective of infrastructure in-sourcing. They can go for traditional infrastructure that is put together by a system integrator and may consist of converged/engineered systems and hyper-converged infrastructure.
“When it comes to rapid delivery of services such as virtual desktops for a new projects, CIOs prefer converged and hyper-converged infrastructure. CIOs and infrastructure heads need freedom of choice when it comes to converged infrastructure to help avoid vendor lock-in and get the best price-performance ratio,” says Wagh.
CIO’s are looking at data centres as an investment, and hence, the data centre of the future must be step up to become a valuable contributor to the top-line income stream of a wide range of organisations.
Banking on Converged Solution in 2015
Converged infrastructure industry saw a significant surge in the demand in 2014 despite the fact that many segments of the enterprise infrastructure market have given lacklustre results. The market is bullish going forward in the year 2015 as increasing numbers of enterprises are featuring converged solution at the top of their IT procurement decisions.
“In 2015, HP expects that Indian enterprises will be focusing on building intelligent data centers that focus on optimising existing hardware assets by using additional software capabilities. This will lead to greater focus on newer trends such as public cloud, big data etc,” says HP’s India Som Satsangi.
Major players like EMC are bullish about the converged infrastructure market in India. In this sector they see the opportunity for rapid growth. “I am very bullish about converged infrastructure because it provides ample opportunity for working with small base and grow thereafter. Markets like India will do better in the modular-based-converged than the factory-based-converged infrastructure,” explains Abhijit Potnis of EMC.
VMware’s Wagh points out that the organisations have already made investments in converged infrastructure and those investments are going to increase in future. The early adopters in this segment are IT, Telecom and BFSI, and they are likely to lead the market in coming years.
“Software defined data centers represent the IT infrastructure of the future and will bring greater levels of flexibility to enterprises by allowing them to optimise their IT environments to meet specific workload needs,” concludes Manish Gupta of Dell India.