Expansion, virtualization, cloud services drive data center markets

By Neil Zawacki
Updated: April 08, 2011

Infonetics Research recently published a series of reports that predicted data center markets will continue to expand over the next year. North American companies are expected to increase spending on data center hardware and software by at least 25%, and the increased popularity of virtualization and cloud services will likely play a prominent role in this development.

The worldwide data center equipment market made approximately $8 billion in 2010. This was more than 50% higher than the overall revenue generated by data center switches, WAN optimization devices, and application delivery controllers the previous year. Sales are expected to fluctuate somewhat in 2011, but still enjoy strong growth in the business market.

The virtualization of data centers is seen as one of the top reasons for the upcoming expansion, in part due to their lower cost and the numerous special features they have available. Cloud services are also predicted to become more common as the modern business world adopts the technology in greater numbers. Another notable trend mentioned in the series of reports is the increased interest in Fiber Channel Over Ethernet for SAN (also known as Storage Area Networks).

Data center switches, which currently make up the largest portion of the market, almost doubled their annual revenue for purpose-built equipment. This trend was observed over multiple quarters and is viewed as part of the ongoing transition away from general-purpose equipment.

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