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Cloud storage to become a lot more competitive in 2016

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January 26, 2016

In its 'Storage Study Report' 451 Research forecasts public cloud storage spending to double in two years, with NetApp, HPE and IBM dropping, as Amazon's AWS and Microsoft's Azure push their way in.

To be sure, 451 asked its enterprise research base “which vendor does your organization currently spend the most with on storage in 2015 and which will it spend the most on in 2017?"

The top five suppliers in 2015 were EMC (at 28.7 percent), NetApp (at 12.9 percent), Dell (at 12.7 percent), Hewlett Packard Enterprise (at 9.9 percent) and IBM (at 9.5 percent).

451 added that AWS and Azure muscled their way into the top five in 2017, but what happened to the others? IT Direction explains.

First, EMC still leads but with lower numbers (23.8 percent) with AWS second at 10.6 percent. For its part, Dell is still third but at 10.3 percent. Microsoft is in fourth place at 9.1 percent with HPE dropping to fifth place, also holding in at 9.1 percent.

NetApp is in 6th place at 8.6 percent, followed by IBM at 7.1 percent. HDS is eighth with 4.9 percent, down from its 2015 total of 5.3 percent.

In joint tenth place is Pure Storage at 1.5 percent, up from the 0.5 percent 451 recorded for 2015. VMware is equal tenth with 1.5 percent; Oracle is in twelfth place with 0.5 percent, down from 2015’s 1.6 percent.

For now it’s very apparent that a Dell-EMC combination in 2017 would command 34.1 percent. Add in VMware and we have 35.6 percent, dwarfing every other supplier.

But Oracle’s falling market share is a big surprise to many. NetApp’s isn't, although the magnitude is. Another non-shocker is IBM’s decline. The research house notes: ``Just 41.7 percent of those who cited NetApp as their key storage supplier intend to increase 2016 spending with that vendor, while almost half (48 percent) plan to cut spending.``

Notably, almost 30 percent plan 25 to 60 percent spending reductions; the highest such decline in the Q4 study. For IBM, just over a third of customers citing IBM as a strategic storage supplier plan to reduce spending on Big Blue’s storage portfolio in 2016.

The on-premises storage spending shifts away from legacy SAN and filer products, with all-flash arrays being the main beneficiary particularly in smaller organizations.

Both hyper-converged infrastructure products and object storage technologies also look set for healthy spending growth in 2016.

The rush to cloud storage is most evident in retail organizations, which expect 25 percent of storage spending to be cloud-based by 2017.

Smaller businesses (those with fewer than 250 employees) expect 20 percent of their storage related spending to be cloud-based by 2017.

The top causes of data capacity growth are: increasing file sizes and user data (46.4 percent), server virtualization (41.7 percent), RDBMS (39.7 percent) and backup and archive (37.4 percent), with data warehouse and analytics coming in at 31.1 percent.

451 notes that the top three vendors, usage-wise, for all-flash arrays are EMC, Hewlett Packard Enterprise and IBM, in that order, followed by Pure Storage and NetApp.

451 also notes that the largest planned spending declines in storage are in tape infrastructure, with over 40 percent of surveyed IT departments planning slight or significant decreases in 2016.

This is an area where public cloud adoption is clearly taking over from traditional approaches. We predict that tape will all but disappear by 2018-2019.

Source: 451 Market Research.

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