Are data centers backing away from businesses

19.03.2020 1,539 6

Martin Deshev

These days data is everywhere and “data-driven business” is a very popular topic and model. This leads to the creation and growth of many data center facilities, technologies and businesses. But this may not mean that the data center is king.

There are certainly factors that could lead to such an opinion. For one it’s the rise of cloud computing which means many enterprises are now transferring their infrastructure to the cloud, instead of investing in building their own data centers. Another factor is the rise of serverless computing where cloud clients don’t focus on the backend and most of this work is automated or carried out by the provider.

So, where does this leave the data center?

In theory it seems like the data center is backing away from the business cases and needs. The focus falls on apps, data crunching and management, analytics and so on. It seems like the hardware is no longer on the mind of most cloud users. But without hardware, there’s no cloud.

So, while it does seem like the data center is stepping out of the spotlight, it’s still very important. It’s just that instead of being in the spotlight, the data center becomes the spotlight and the one who controls where it will shine. The data center is the way for companies to bring out the best out of their data, apps and other digital projects. And to do that, it needs to continue to evolve.

The new future

Ironically, this creates the opportunity for more data-center-focused businesses. Data by 451 Research show that as of September 2019 the total value of deals for data center assets is about $5.4 billion. This is a bit lower that the overall tempo last year, but there seems to be a good explanation.

Up until recently, data centers were viewed as the key component. They were often the final goal of an IT project – to create a data center. Now, things are changing. The mindset is that the data center is simply part of the infrastructure. It’s just there.

While simplistic, this mindset also drives a lot of new possibilities. The companies start viewing the data center as a mixture of ingredients instead of a whole body. Mix them incorrectly – and you have a failing project. Mix them correctly and you have a service that many want to use.

And you can’t make all of those ingredients yourself. You need the right products. This is where a lot of data center businesses start popping up. For example, companies with specific security technologies, companies offering sustainability solutions and so on.

“A company’s IT infrastructure cannot function reliably without suitable data center. Due to the rising quantity of data being sent across the world, data centers need to evolve in order to keep up with networking trends”, says Jacob A Thomas, CTO, Athenta Technologies to Techiexpert.

So, while the data center may be taking a step back in the minds of the businesses using it, it’s about to take a step forward when it comes to the companies which develop solutions and services for data centers. They are going to have a big business with lots of opportunities ahead.