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Data center research finds expansion and cloud computing in support marketplace

By Donna Donowitz
March 23, 2011
After a poor showing due to the continued effects of the recession in 2009, 2010 turned out to be a much better year for the data center equipment industry, with sales trending upward and looking healthy for the immediate future, according to a report from Boston-based Infonetics Research.

Growth in the global data center network equipment market reached 50 percent in 2010, the researchers found, for a sales total of nearly $8 billion. The biggest factor behind these strong numbers was the increased demand for network switches, which have increasingly become purpose-built, rather than general-use devices, the analysts added. Sales of such specialized items almost doubled in just the last three months of the year, according to Infonetics.

In that particularly hot market segment, Cisco Systems was a top performer, selling 80 percent of the total data center Ethernet switches in 2010. The company also made gains in the market for application delivery controllers and maintained its position amid the top three - along with Blue Coat and Riverbend - in WAN optimization.

Matthias Machowinski, directing analyst for enterprise networks and video at Infonetics, said that the overall trend seen in 2010 will largely continue in 2011.

"For 2011, we expect tempering but still robust growth in sales, and the biggest opportunities for vendors is in helping companies grow their data center infrastructure sustainably, such as through the use of products that dramatically increase price-to-performance or improve management in highly virtualized environments," he stated.

In terms of the emergent data center technologies being adopted by the corporate IT world, Infonetics found that fiber channel over Ethernet excited a great deal of interest, as did 100 Gigabit Ethernet, despite a lack of available products compared to the 40 GE system. Fiber channel itself was found to be the SAN technology in widest use, the researchers added.

Updating a company's systems to comply with the newer IPv6 internet standard could provide a further boost to the data center equipment industry in 2011, along with the wider uptake of cloud computing services, experts say.


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