Skip to main content

Software-Defined IT Solutions are Gaining Momentum

Server, storage and networking hardware revenue decreased 1.1 percent year-to-year in the first quarter of 2016 (1Q16), due to ongoing software prioritization in the IT data center market, according to the latest market study by Technology Business Research (TBR).

Year-to-year growth in the industry-standard server (ISS) and networking product segments was not enough to drive overall revenue growth during the quarter, due to steep declines in the legacy proprietary server segment.

Software functionality is very important in the migration to hybrid cloud-enabled and data-centric IT business models, as enterprise buyers seek to mitigate complexity and management challenges. This change in demand is causing a significant shift away from proprietary servers and legacy storage technologies.

Data Center Market Development Transition

"Customers target high business growth areas to make strategic IT investments, but at the same time, they face budget restraints," said Krista Macomber, senior analyst at TBR.

Hardware commoditization drove combined proprietary server and storage revenues for vendors down by 27.9 percent and 7.3 percent year-to-year, respectively.

Growth of ISS and networking revenues was attributed to vendors’ abilities to monetize investments in emerging growth areas such as cloud computing and flash storage.

Data center hardware revenues declined across the Americas and EMEA, while growing in APAC for the sixth consecutive quarter during 1Q16, per the latest TBR estimates.

TBR analysts believe that geopolitical challenges and increasing volatility in emerging countries will drive vendors to capitalize on opportunities in markets of consistently high growth.

Outlook for Software-Defined Infrastructure

"Storage-focused vendors are investing in areas such as converged infrastructure and flash to better address customers’ cloud and analytics workloads needs," said Macomber.

They're also making these strategic investments to differentiate their portfolios, as the storage market continues to decline due to the IT investment shift from traditional hardware to software-defined infrastructure.

To cope with geopolitical challenges and support growth of enhanced portfolio capabilities, vendors seek local partners in areas where they fail to gain market entry. Additionally, vendors are making more acquisitions in regions where they would otherwise struggle to expand.

Popular posts from this blog

Industrial and Manufacturing Technology Growth

In an evolving era of rapid advancement, market demand for innovative technology in the industrial and manufacturing sectors is skyrocketing. Leaders are recognizing the immense potential of digital transformation and are driving initiatives to integrate technologies into their business operations.  These initiatives aim to enhance efficiency, reduce costs, and ultimately drive growth and competitiveness in an increasingly digital business upward trajectory. The industrial and manufacturing sectors have been the backbone of the Global Networked Economy, contributing $16 trillion in value in 2021. Industrial and Manufacturing Tech Market Development   This growth represents a 20 percent increase from 2020, highlighting the resilience and adaptability of these sectors in the face of unprecedented challenges, according to the latest worldwide market study by ABI Research . The five largest manufacturing verticals -- automotive, computer and electronic, primary metal, food, and machinery -

Rise of AI-Enabled Smart Traffic Management

The demand for smart traffic management systems has grown due to rising urban populations and increasing vehicle ownership. With more people and cars concentrated in cities, problems like traffic congestion, air pollution, and greenhouse gas emissions are pressing issues. Since the early 2000s, government leaders have been exploring ways to leverage advances in IoT connectivity, sensors, artificial intelligence (AI), and data analytics to address these transportation challenges. The concept of a Smart City emerged in the 2010s, with smart mobility and intelligent traffic management as key components.  Smart Traffic Management Market Development Concerns about continued climate change, as well as cost savings from improved traffic flow, have further motivated local government investment in these advanced systems. According to the latest worldwide market study by Juniper Research, they found that by 2028, smart traffic management investment will be up by 75 percent from a 2023 figure of

AI Software Market will Reach $251 Billion

The growth in Artificial Intelligence (AI) software could lead to many benefits. As more organizations adopt AI, they may become more efficient, productive, and able to offer improved products and services. The global job market could also expand, with demand growing for roles like AI engineers and technicians. Plus, AI apps could enable breakthroughs in fields like healthcare, transportation, and energy. The worldwide AI software market will grow from $64 billion in 2022 to nearly $251 billion in 2027 at a compound annual growth rate (CAGR) of 31.4 percent, according to the latest market study by International Data Corporation (IDC). AI Software Market Development The forecast for AI-centric software includes Artificial Intelligence Platforms, AI Applications, AI System Infrastructure Software (SIS), and AI Application Development and Deployment (AD&D) software (excluding AI platforms). However, it does not include Generative AI (GenAI) platforms and applications, which IDC recent