The market for software-defined data centers is expected to keep growing, says a new report.
Data centers are no longer just about all the hardware gear you can stitch together for better operations. There’s a lot of software involved to squeeze more performance out of your hardware, and all that software is expected to contribute to a burgeoning new market dubbed the software-defined data center.
A new report issued this week by Research and Markets explains that the software-defined data center market will hit $77.18 billion by the year 2020, which is up from the $21.78 billion it’s expected to rake in for 2015. The term software-defined data center generally refers to the way different elements of the data center—like networking, storage, and computing—can be more better dispersed with the help of software.
Emerging technologies like software-defined networking—in which specialized software can be installed in cheap, commodity servers to power a company’s networking activities—present challenges to legacy businesses like Cisco CSCO and Juniper Networks JNPR who sell all-in-one networking gear. Similarly, a type of technology called software-defined storage that basically lets companies link together all their different storage hardware in data centers to be read as one giant virtual pool of data could also give traditional storage vendors like EMC EMC a run for their money.
There are a host of emerging startups like Cumulus Networks and Primary Data (whose chief scientist is Apple co-founder Steve Wozniak) that are gaining of attention from analysts who believe their technology could impact legacy companies.
But, these big enterprise businesses are not just going to sit down and let startups take all of the momentum. The Research and Markets report cites companies like Cisco, EMC, and Fujitsu as key players in contributing to the growth of the software-defined data center market.
The report explains that the adoption of this type of technology is still in its early stages, with the last twelve months indicating that more businesses are eager to learn more and perhaps fork out cash in the near future.
It’s still anybody’s game as to who dominates this space, and considering the deep pockets that many legacy enterprises have, it makes sense that they would try to capitalize on an area of technology they’d be wise not to ignore.
As Cumulus Networks CEO JR Rivers said in a recent interview with Fortune, the losers in the software-defined networking space “will be companies that narrowly focus on one part of the industry.”
“That doesn’t mean that Cisco will lose; it may shift its business model,” Rivers said. “But change is hard.”
For more on data centers, check out the following video from Fortune: