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Increased storage spend bolsters cloud infrastructure market revenue

Increased storage spend bolsters cloud infrastructure market revenue

Cloud IT infrastructure sales as a share of overall worldwide IT spending climbed to 39 per cent in 1Q17

Vendor revenue from sales of infrastructure products for cloud IT, including public and private cloud, grew 14.9 per cent year-on-year in the first quarter of 2017 (1Q17), reaching US$8 billion.

Spanning server, storage and Ethernet switch offerings, cloud IT infrastructure sales as a share of overall worldwide IT spending climbed to 39 per cent in 1Q17, representing an increase from 33.9 per cent a year ago.

According to IDC research, revenue from infrastructure sales to private cloud grew by six per cent to US$3.1 billion, and to public cloud by 21.7 per cent to US$4.8 billion.

In comparison, revenue in the traditional (non-cloud) IT infrastructure segment decreased eight per cent year-on-year in the first quarter of the year.

“After a weak performance during 2016, storage purchases for cloud IT environments had a strong rebound in the first quarter, driving the overall growth in this segment,” IDC research director Natalya Yezhkova said.

“Overall, the first quarter set a strong beginning of the year for the cloud IT infrastructure market.”

Delving deeper, private cloud infrastructure growth was led by Ethernet switch at 15.5 per cent year-on-year growth, followed by storage (excluding double counting with servers) at 10 per cent and server at 2.1 per cent.

Meanwhile, public cloud growth was led by storage, which after heavy declines in 1Q16 grew 49.5 per cent year-on-year in 1Q17, followed by Ethernet switch at 22.7 per cent and server at 8.7 per cent.

In traditional IT deployments, server declined the most (9.3 per cent year-on-year), with Ethernet switch and servers declining 4.4 per cent and 6.1 per cent, respectively.

“With positive dynamics in purchasing activity by hyper-scalers across all technology segments we expect a strong year ahead for the fastest growing public cloud segment,” Yezhkova added.

“And as end users continue to embrace the benefits of private cloud infrastructures, spending in this segment will also expand."

From a regional perspective, vendor revenue from cloud IT infrastructure sales grew fastest in Canada at 59.1 per cent year-on-year in 1Q17, followed by Asia/Pacific (excluding Japan) at 18.7 per cent.


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