By 2020, enterprise spending on cloud, hosted and traditional infrastructure services will be more or less on par, Gartner has predicted.
The research firm said the growth of cloud and industrialized services and the decline of traditional data center outsourcing (DCO) indicate a massive shift toward hybrid infrastructure services.
“As the demand for agility and flexibility grows, organizations will shift toward more industrialized, less-tailored options,” said DD Mishra, research director at Gartner.
“Organizations that adopt hybrid infrastructure will optimize costs and increase efficiency. However, it increases the complexity of selecting the right toolset to deliver end-to-end services in a multi-sourced environment.”
Gartner predicts that by 2020, 90% of organizations will adopt hybrid infrastructure management capabilities.
The traditional DCO market is shrinking, according to Gartner’s forecast data. Worldwide traditional DCO spending is expected to decline from $55.1 billion in 2016 to $45.2 billion in 2020. Cloud compute services, on the other hand, are expected to grow from $23.3 billion in 2016 to reach $68.4 billion in 2020.
Spending on colocation and hosting is also expected to increase, from $53.9 billion in 2016 to $74.5 billion in 2020. In addition, infrastructure utility services (IUS) will grow from $21.3 billion in 2016 to $37 billion in 2020 and storage as a service will increase from $1.7 billion in 2016 to 2.7 billion in 2020.
In 2016, traditional worldwide DCO and IUS together represented 49% of the $154 billion total data center services market worldwide, consisting of DCO/IUS, hosting and cloud infrastructure as a service (IaaS). This is expected to tilt further toward cloud IaaS and hosting, and by 2020, DCO/IUS will be approximately 35% of the expected $228 billion worldwide data center services market.