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SDDCs doubling every year

Firm boosts CAGR from 69% from 2013-2018, to 98% from 2014-2018

By Jim Duffy on Thu, 11/21/13 - 4:45pm.

The global software defined data center market is now expected to grow at a compounded annual rate of 97.48% from 2014-2018, according to Dublin's Research and Markets, up from the 68.7% CAGR published by the firm just a few months ago. One of the key factors contributing to this market growth is the increasing demand for cloud computing -- enterprises are embracing both public and private cloud computing services as a way to cost-effectively boost performance and productivity, the firm found.

Back in August, Research and Markets expected the total SDDC market to grow from $396.1 million in 2013 to $5.41 billion by 2018, an estimated CAGR of 68.7% from 2013 to 2018. The market includes software-defined networks (SDN) and security, software-defined storage and software-defined server and compute.

[BATTLE ROYALE: Cisco takes fight to SDNs with bold Insieme launch]

Research and Markets did not clarify its new figure, inviting us instead to purchase their full report. But research firm IDC expects SDNs alone to grow to $3.7 billion in 2016 from $360 million this year, a CAGR of over 117%. IDC also expects software-defined storage to be the fastest growing segment of the storage market in coming years.

Other research states that the SDN market has the potential to reach $35 billion by 2018.

In addition to cloud, the SDDC market is also driven by an increase in the growth of structured and unstructured data. Structured data has a pre-defined data structure, like databases, while unstructured data has no specific internal data structure and can come from many external sources. They can include documents, audio files and video files gathered from the cloud, social networking sites and mobile devices.

Enterprises need structured and unstructured data to be securely accessible as part of the corporate information framework for analysis and decision making, Research and Markets suggests. This results in the need to effectively manage storage resources, a key objective of SDDCs, the firm notes.

Enterprises software defining their data centers, though, could be in for a surprise. Service providers have concerns over the complexity of implementing and managing software-defined networks, according to a survey from Packet Design, a developer of route analytics software.

Even though 90% of the 100 organizations surveyed are evaluating, deploying or planning to deploy SDN, 57% of service providers cite complexity as their chief concern. And despite the work by standards bodies and consortia to define APIs and open source controllers, 26% of respondents fear vendor lock-in from SDNs.

A key consideration though is that service providers will most likely go the DIY approach and integrate most or all of the SDDC/SDN components by themselves. Enterprises will opt for pre-integrated offerings or employ the integration services capabilities of their vendors or systems integrators.

Other SDN concerns found in the Packet Design survey include cost to implement, cited by 25% of respondents, and lack of management visibility, by 21%. More than 10% -- respondents were allowed to list more than one concern -- said there is not enough benefit from SDN for the effort and cost.

Seventy-one percent said that some of their existing management tools will not work with SDN, and 84% percent stated that SDN creates new management challenges that require new tools, the Packet Design survey found (predictable conclusions from a survey conducted by a network management vendor). Forty-eight percent believe that SDN will reduce the number of management tools they need, while 34% are depending upon their network equipment vendor(s) to supply the SDN management tools they need.

Despite the effort though, it's clear from the market figures being lobbed about that folks are soaking this stuff up.

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