Data centers are shrinking but not going away

Companies are putting more compute into less data-center space and shifting some workloads away from the cloud.

server room / data center
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The cloud will not kill the data center, but it will transform it. That's one of the takeaways from the 2020 State of the Data Center report from AFCOM, the industry association for data center professionals.

In the near term, construction will slow way down, which aligns with what IDC analyst Rick Villars told me about data center construction slowing after a big buildout. More than 60% of respondents to the AFCOM report said they have no plans to build a new facility in the next 12 months, although 53% said they'll have at least one data center in the works over the next 36 months.

Only 16% of respondents expect to build two or three data centers over the next three years. On the topic of renovating or expanding data centers over the coming 12 to 36 months, respondents said an average of one or two data centers would be renovated, down from about four in last year's report.

But that does not mean the end of the enterprise data center. Bill Kleyman, executive vice president of digital solutions at Switch and author of the report, wrote: "Although cloud will continue to play a key role in how we deliver core applications and services, it will not replace data center solutions. This is evident by the types of investments that major cloud providers are making in having their solutions run within your data center."

Three of the big four U.S. cloud providers have software solutions to deploy in your data center and replicate the same experience as their cloud services – Google Anthos, Azure Stack, and AWS Outposts. IBM doesn't quite have an offering, although with Red Hat under the IBM umbrella, I can't see it not happening. For now there's the IBM Cloud Integration Platform to help operate cloud services across cloud and on-premises environments under one secure operating model and toolset.

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