Storage networking market driven by familiar forces: hyperscale, software-defined

By Patrick McLaughlin

Some recent market reviews and forecasts focused on storage networking echo familiar tunes: Hyperscale data centers largely dictate a market’s ebb and flow, and just about everything is becoming software-defined.

Reporting on the first quarter of 2017, International Data Corp. (IDC) found the global enterprise storage market was essentially flat, coming in at a 0.5-percent decrease year-over-year at $9.2 billion. The analyst detailed, “Total capacity shipments were up 41.4 percent year-over-year to 50.1 exabytes during the quarter. Revenue growth increased within the group of original design manufacturers (ODMs) that sell directly to hyperscale data centers. This portion of the market was up 78.2 percent year over year to $1.2 billion. Sales of server-based storage were down 13.7 percent and accounted for $2.7 billion in revenue. External storage systems remained the largest market segment, but the $5.2 billion in sales represented a modest decline of 2.8 percent year over year.”

Liz Conner, research manager for storage systems with IDC, observed, “The enterprise storage market closed out the first quarter relatively flat, yet adhered to a familiar pattern. Spending on traditional external arrays continues to slowly shrink while spending on all-flash deployments once again posted strong growth and helped to drive the overall market. Meanwhile, the very nature of the hyperscale business leads to heavy fluctuations within the market segment, displaying solid growth in 1Q17.”

Dell’Oro Group also reports quarterly on the storage market, and echoed some of the sentiments. Jimmy Yu, vice president at Dell’Oro Group, explained, “All flash array is the only segment growing in the external storage market space. While the total market for external storage has contracted for the past two years, and will likely decline again this year, all flash storage system sales are reaching all new highs. We predict all flash array revenue to grow approximately 40 percent in 2017 to reach nearly $7 billion, while disk and hybrid storage system revenues decline about 14 percent.”

IDC also separately tracks the software-defined storage (SDS) market. In a document it published earlier this year titled “IDC’s worldwide software-defined storage taxonomy, 2017,” the firm said, “Overall, enterprise storage will be growing only at a 2.8 percent compound annual growth rate through 2020, signifying a mature market. As the industry evolves to better support the digital transformation most data centers are undergoing, there are significant shifts in spending occurring to new areas. A number of these newer areas are multibillion-dollar markets that are robustly growing at strong double-digit rates, and SDS is one of these areas. SDS solutions typically run on server-based storage (SBS) hardware platforms …

“IDC defines an SDS solution as a storage system (hardware plus software) that delivers a full suite of persistent storage services via an autonomous software stack that can run on any industry-standard (rather than proprietary or custom) hardware platform (known as server-based storage).”

Thomas Wellinger, market manager for data centers with cabling-system supplier Reichle & De-Massari (R&M), said recently that the rise of SDS will demand high-performance cabling within the data center. He explained, “Since major providers of IT infrastructures launched the principle of SDS, previous storage systems have been marginalized. The x86 servers with PCIe 3.0 bus appeared on the market [approximately five years ago]. This meant the conditions were created for the integration of storage tasks into the server infrastructure. A standard server on two height units with six card slots suddenly offered more bandwidth and performance potential than any midrange storage system.

“A data center has to use powerful servers to be able to run the numerous virtual machines. And storage volume can easily be added for the price of further server disks. For example, on the basis of SDS, servers for virtual machines are equipped with 24 instead of only 2 or 3 disks. And there is already sufficient storage available, for the marginal cost of additional server disks,” he continued.

Wellinger maintained that SDS will not decrease the demand for supporting cabling. The cabling either will be shifted or even become more-in-demand. “This has to be taken into account right from the infrastructure planning phase,” he said. “Until now, cables have run from the server’s network interface card to the Ethernet switch as well as from the server’s host bus adapter to the Fibre Channel switch, and from there to the storage. The amount of cables was split over the relevant areas. This meant cabling density was still relatively low.

“Shifting storage into the server housing means networks are consolidated. Cabling density increases as a result, both on the server housing and on the switch or router. Increasing virtualization means data traffic between servers grows. At the same time, there is a further increase in CPU and PCI performance.

“These advances should also get through to users. They expect acceptable latency. As a result, data centers have to ensure their networks can cope with using 40- and 100-Gigabit Ethernet.”

Patrick McLaughlin is our chief editor.