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Data center network spending climbing

By Donna Donnowitz
September 29, 2011
Many data center operators are responding to the growing importance of networking by upgrading their infrastructure and investing in new network equipment. According to a recent quarterly study from Infonetics Research, the global market for data center network equipment - which includes Ethernet switches, WAN optimization appliances and application delivery controllers among more traditional hardware - climbed substantially during the second quarter 2011.

In terms of sequential growth, the sector rose by 3 percent. This positioned the overall market for 4 percent year-over-year growth. Almost every aspect of network equipment is benefiting from increased spending. Even SAN switch and adaptor sales, which faces a 1 percent decline in sequential evaluation, still sees a 16 percent year-over-year expansion, according to the study.

The rapid growth in data center network equipment sales is creating a basis for converged infrastructure, and developing an environment where the technological solution can flourish, according to Sam Barnett, directing analyst for data center and cloud at Infonetics Research.

"The foundation is finally set for true convergence of data center network infrastructure. Any way we look at it, we see convergence accelerating … Very soon we're going to hit the inflection point where we can unify all networking silos in the data center, as companies rapidly adopt a single network infrastructure to lower costs, simplify management, and reap the benefits of economies of scale," said Barnett.

Currently, Barnett said many organizations are amid investment cycles for SANs and other data center network equipment, creating an environment for rapid growth until these cycles conclude.

On a regional scale, Asia-Pacific is the largest sector for growth as emerging economies and increased interest in IT systems drive network equipment investments, according to the study.

For the most part, the network equipment sector's success around the world is being fueled by data center expansion projects and investments in virtualization and cloud computing, Infonetics Research found.

As more data center operators consider investing in new networking systems, transitioning to IPv6 could emerge as a priority. According to a recent Data Center Knowledge report, most organizations are primarily motivated to adopt IPv6 because IPv4 addresses are running out. However, the data center sector can benefit substantially from IPv6's sophisticated capabilities, making it a key area of focus in the industry.


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