Cloud Infrastructure Growing 18.9% in 2016, Ethernet Switches Growing 26.8%

According to the International Data Corporation (IDC) Worldwide Quarterly Cloud IT Infrastructure Tracker, total spending on IT infrastructure products (server, storage, and Ethernet switch) for deployment in cloud environments will increase by 18.9% in 2016 to reach $38.2 billion. This amount excludes double counting between storage and server. In comparison, spending on enterprise IT infrastructure deployed in traditional, non-cloud, environments will decline by 4% in 2016, but will still account for the largest share, 62.8%, of end user spending. Spending on private cloud IT infrastructure will grow by 11.1% year over year to $13.9 billion geared toward on-premises private cloud deployments. Spending on public cloud IT infrastructure will increase by 14.1% in 2016 to $24.4 billion.

From a geographic perspective, investments in cloud IT infrastructure will grow across all regions. As cloud service providers continue to expand their portfolio of offerings and customer reach, the public cloud segment will deliver the highest rate of IT spending growth in a majority of regions compared to private cloud and non-cloud environments.

Looking at total cloud IT infrastructure spending, Ethernet switches are forecast to grow at the highest rate, 26.8%, while spending on servers and storage will grow at 12.4% and 11.3%, respectively.

In the long-term forecast, IDC expects that spending on IT infrastructure for cloud environments will grow at a 12.5% five-year compound annual growth rate (CAGR) to $57.8 billion in 2020. This will represent 47.9% of the total spending on enterprise IT infrastructure in 2020. Spending on non-cloud IT infrastructure will decline at a 1.3% CAGR during the same period. Within the cloud segment, spending on public and private cloud IT infrastructure will experience CAGRs of 13.8% and 10.2%, respectively. In 2020, IDC expects service providers will spend $37.5 billion on IT infrastructure for delivering public cloud services, while spending on private cloud IT infrastructure will reach $20.3 billion.

“For the majority of corporate and public organizations, IT is not a core business but rather an enabler for their core businesses and operations,” said Natalya Yezhkova, Research Director, Storage Systems. “Expansion of cloud offerings creates new opportunities for these businesses to focus efforts on core competences while leveraging the flexibility of service-based IT.”

Top 5 Corporate Family, WW Cloud IT Infrastructure Vendor Revenue, 4Q15
(revenue in million, excludes double counting of storage and servers)

WW Cloud IT Infrastructure Top 5 Cloud Vendors Revenue, 4Q14 vs. 4Q15
(shares based on vendor revenue)

(Source: IDC’s Worldwide Quarterly Cloud IT Infrastructure Tracker, April 2016)

 

Top 5 Corporate Family, WW Cloud IT Infrastructure Vendor Revenue, 2015
(revenue in million, excludes double counting of storage and servers)

(Source: IDC’s Worldwide Quarterly Cloud IT Infrastructure Tracker, April 2016)

Note:
Dell and Cisco both ranked number 2 in 4Q15, and IBM and NetApp both ranked number 5 in 2015 in a statistical tie. IDC declares a statistical tie in the worldwide cloud IT infrastructure market when there is less than one% difference in the revenue share of two or more vendors.

IDC’s Worldwide Quarterly Cloud IT Infrastructure Tracker is designed to provide clients with a better understanding of what portion of the server, disk storage systems, and networking hardware markets are being deployed in cloud environments. This tracker will break out vendors’ revenue by the hardware technology market into public and private cloud environments for historical data and also provide a five-year forecast by the technology market.

Taxonomy Notes:

IDC defines cloud services more formally through a checklist of key attributes that an offering must manifest to end users of the service. Public cloud services are shared among unrelated enterprises and consumers; open to a largely unrestricted universe of potential users; and designed for a market, not a single enterprise. The public cloud market includes variety of services designed to extend or, in some cases, replace IT infrastructure deployed in corporate datacenters. It also includes content services delivered by a group of suppliers IDC calls Value Added Content Providers (VACP). Private cloud services are shared within a single enterprise or an extended enterprise with restrictions on access and level of resource dedication and defined/controlled by the enterprise (and beyond the control available in public cloud offerings); can be onsite or offsite; and can be managed by a third-party or in-house staff. In private cloud that is managed by in-house staff, “vendors (cloud service providers)” are equivalent to the IT departments/shared service departments within enterprises/groups. In this utilization model, where standardized services are jointly used within the enterprise/group, business departments, offices, and employees are the “service users.”

 

Tags: Ethernet Switches, IDC

Category: News