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Enterprise Cloud Storage Demand will Double by 2017

Worldwide, many enterprise IT organizations are experiencing an exponential growth of data storage requirements as employees create more digital content. Multimedia asset storage is a key driver -- in particular, a variety of video content.

In today's enterprise, video is a primary method for engaging with customers, employees and channel partners, via a wide range of media assets. Common video applications include online webcasts, conference sessions or keynotes, training sessions or educational webinars and new customer care use-cases.

Demand for object storage systems has blossomed as a results of the growing need to archive unstructured data, such as video and other forms of multimedia content. This growth has fueled the deployment of new cost-effective storage solutions that can scale to support hundreds of petabytes and beyond.

Enterprise IT Storage Market Development

According to the findings from the latest 451 Research 'Voice of the Enterprise' survey, organizations will continue to transform their IT storage environments in 2016, with most expecting to increase their overall storage spending over the next year.

Their research reveals that the proportion of spending on public cloud storage services will likely double over the next two years -- potentially at the expense of traditional, on-premises storage.

"The storage infrastructure may have proven itself hardy to change over the years, but it is not immune to the same uber-trends that are fundamentally disrupting the role of IT at organizations of all sizes," said Simon Robinson, vice president at 451 Research.

He believes that IT managers are recognizing the need for storage transformation to meet the realities of the new Digital Economy -- especially in terms of improved efficiency and agility in the face of relentless data growth.

Robinson adds that it's clear from their fourth quarter 2015 study that emerging options -- such as Public Cloud Storage and All-Flash Array technologies -- will be increasingly important components in this transformation.

Key insights from the market study include:

  • Storage spending will be healthy in 2016, with over 70 percent of respondents expecting to increase their storage spending over the next 12 months, compared to 2015.
  • However, storage spending growth in Europe and among very large organizations (over 10,000 employees) will be weaker than average, as will spending in the government and utilities verticals.
  • On average, spending on public cloud storage will account for 17 percent of total enterprise storage spending by 2017, up from 8 percent today.
  • In some verticals -- such as retail -- the public cloud will account for 25 percent of total storage spending by 2017. Spending on on-premises storage will fall from 70 percent in 2015 to 58 percent in 2017.
  • While the traditional storage players, led by EMC, dominate the list of strategic players today, this looks set to change over the next two years. Both Amazon Web Services and Microsoft Azure could become top five storage vendors by 2017.
  • From a storage products perspective, spending will increase the most on public cloud and all-flash arrays, while spending on traditional SAN and NAS products will be more muted. The largest spending declines will be on tape storage products.
  • Dealing with data and storage capacity growth is by far the single greatest pain-point for storage managers. Respondents cited improved backup and disaster recovery as top storage objective for 2016.

The 451 Research study focuses on end-user trends in enterprise storage. Based on research conducted with over 700 IT professionals worldwide, the quarterly study combines 451 Research's analysis with responses from a panel of more than 25,000 senior IT buyers and enterprise technology executives.

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