Cloud infrastructure continues to grow in 2020 – IT-Online

Vendor revenue from sales of IT infrastructure products (server, enterprise storage, and Ethernet switch) for cloud environments, including public and private cloud, increased 2,2% in the first quarter of 2020 (1Q20) while investments in traditional, non-cloud, infrastructure plunged 16,3% year over year.

According to the International Data Corporation (IDC) Worldwide Quarterly Cloud IT Infrastructure Tracker, the broadening impact of the COVID-19 pandemic was the major factor driving infrastructure spending in the first quarter.

Widespread lockdowns across the world and staged reopening of economies triggered increased demand for cloud-based consumer and business services driving additional demand for server, storage, and networking infrastructure utilised by cloud service provider datacenters.

As a result, public cloud was the only deployment segment escaping year-over-year declines in 1Q20 reaching $10,1-billion in spend on IT infrastructure at 6,4% year-over-year growth. Spending on private cloud infrastructure declined 6,3% year over year in 1Q to $4,4-billion.

IDC expects that the pace set in the first quarter will continue through rest of the year as cloud adoption continues to get an additional boost driven by demand for more efficient and resilient infrastructure deployment.

For the full year, investments in cloud IT infrastructure will surpass spending on non-cloud infrastructure and reach $69,5-billion or 54,2% of the overall IT infrastructure spend.

Spending on private cloud infrastructure is expected to recover during the year and will compensate for the first quarter declines leading to 1,1% growth for the full year. Spending on public cloud infrastructure will grow 5,7% and will reach $47,7-billion representing 68,6% of the total cloud infrastructure spend.

Disparity in 2020 infrastructure spending dynamics for cloud and non-cloud environments will ripple through all three IT infrastructure domains Ethernet switches, compute, and storage platforms.

Within cloud deployment environments, compute platforms will remain the largest category of spending on cloud IT infrastructure at $36,2-billion while storage platforms will be fastest growing segment with spending increasing 8,1% to $24,9-billion. The Ethernet switch segment will grow at 3,7% year over year.

At the regional level, year-over-year changes in vendor revenues in the cloud IT Infrastructure segment varied significantly during 1Q20, ranging from 21% growth in China to a decline of 12,1% in Western Europe.

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Cloud infrastructure continues to grow in 2020 - IT-Online

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