What’s driving the data storage market?
When it comes to storage, there are differing views about what the biggest drivers are in the current market, which gives the channel a lot to think about
Just because you ask a simple question, doesn’t mean you’ll get a simple answer that everyone can agree on. Not completely, anyway. Ask a bunch of vendors to identify the biggest drivers in the data storage market and you’ll get replies that have some things in common and others that might have more to do with their own products and strategies than the market overall.
To begin with, of the areas that nearly everyone agrees are having (or will have) a strong effect on the storage market, one of the most prominent is cloud.
Denise Bryant, UK channel director at NetApp, describes the migration of enterprise production workloads to the hybrid cloud as the biggest factor now and over the next five years. As supporting evidence, she cites the IDC Global StorageSphere 2021-2025 forecast, which predicts that 55% of data created will be stored in the cloud and 65% of enterprises will be using cloud storage by 2025.
Matthieu Brignone, Europe, Middle East and Africa (EMEA) vice-president for partners at Pure Storage, says the data storage market needs to prioritise agility and flexibility because “organisations want a cloud-based, pay-as-you-go, flexible consumption model, that they can pay for as and when they use it, to transform their infrastructure and modernise their applications”.
He adds that subscription services are enjoying strong growth in the data storage market, providing opportunities for partners to differentiate through services and technology that enables customers rather than holding them back. “This pivot to as-a-service offerings is one of the biggest trends we’re seeing in the channel,” he says.
Like Bryant, Brignone cites an IDC study that predicts 43% of organisations expect consumption of as-a-service models to increase by 2024.
Finding ways to manage unstructured data
Eric Bassier, senior director of product marketing at Quantum, identifies unstructured data, such as video, different forms of imagery and other large files, as a significant growth factor. File and object storage is also expected to grow as the primary means of storing unstructured data.
“The use and adoption of object storage is expected to grow as the volume of data continues to expand,” he says. In addition, he too predicts as-a-service offerings will grow as organisations transition to cloud-first operating models.
“Organisations want a cloud-based, pay-as-you-go, flexible consumption model, that they can pay for as and when they use it, to transform their infrastructure and modernise their applications”
Matthieu Brignone, Pure Storage
According to Bassier, object storage is expected to become a mainstream technology with widespread adoption in the next few years, in general replacing legacy file storage systems and network-attached storage (NAS) appliances that don’t have the scale or resiliency required for large volumes of unstructured data.
Jeff Denworth, chief marketing officer and co-founder of Vast Data, says the move to high-scale all-flash “has become a key imperative across the enterprise as organisations have learned that time to insight is far more valuable than cost per gigabyte”.
Along with several others, he mentions the dreaded “R” word – ransomware – which he says “has emerged as a second vector of IT complexity, where fast recovery and fast analytics (for ransomware detection) are also critical for the responsive and resilient enterprise”.
Denworth agrees with Bassier that the market for unstructured data is growing at a fast rate. “Large-scale analytics, backup, social media and rich content are all driving unprecedented demand for scale-out NAS and object storage, where data is growing at a rate of nearly 40% annually,” he states.
“The adoption of all-flash file and object storage is an undercurrent to this rapid growth in data, where organisations are now buying five to 10 times more flash-based file and object storage than in the past.”
Unsurprisingly, Denworth takes aim at legacy vendors, the “old guard” of Dell, NetApp, HPE, IBM, Hitachi and Pure, boasting of Vast’s high growth rate “because it has cracked the code of combining scalable high performance and affordable capacity”.
Pure Storage’s Brignone might take issue with being labelled as part of the legacy squad, as he argues that “legacy storage is defined by its limitations, and should be a thing of the past, along with refresh cycles and forklift upgrades”. He is also quick to condemn “legacy ways of working which are falling behind and should be left there for good reason”. He cites locking customers into contracts and taking no responsibility for service-level agreements (SLAs), which he says are “no longer acceptable practices and do not fit with modern customers’ laser focus on agility and flexibility”.
In terms of areas for future growth, Rob Tomlin, vice-president for the UK channel at Dell Technologies, singles out small and medium-sized enterprises (SMEs), which make up more than 70% of its dealings. The majority are at a crossroads because they need to re-evaluate their IT infrastructure.
“Many businesses will be looking to the public cloud hyperscalers as an easy option to meet their infrastructure needs,” he says, but “an exclusively public cloud operation is not the best route for businesses looking to make the best use of the ongoing data explosion.”
Opportunities abound in hybrid cloud
To get the most from their data resources, organisations need powerful and cost-efficient solutions that can help to simplify data management, reduce latency, enable more robust data protection and make data continuously available.
“Speaking with customers, the need to quickly scale is clear,” Tomlin remarks. “A hybrid cloud strategy offers the combined advantages of on-premise, private and public cloud deployments, promising security, protection and availability.”
Andrew McDade, HPE
Andrew McDade, general manager for data and storage solutions at HPE, agrees with that perspective, noting that hybrid cloud has seen rapid growth. He expects more data management solutions to hit the market that simplify hybrid cloud deployments and streamline data mobility. The need for speed of access and for analysing data will also drive further growth in the all-flash array market.
On the subject of hybrid cloud, he expects many more cloud providers “fighting their space in the datacentre”, with more traditional vendors delivering a hybrid-by-design approach. “For vendors that are still focused on siloed point solutions, not making the jump to hybrid could likely mean a major setback as customers are no longer buying for singular needs,” he warns.
Tomlin argues that a hybrid cloud offering means partners can secure profitability on the transaction and ongoing services revenues. “This creates an opportune situation whereby partners can lead their customers end-to-end and own that entire journey with a recommendation that is, in all likelihood, the best solution for their customers,” he says.
The ever-important consultancy play
Lewis Simmonds, HPE UK channel sales leader, says it is key that channel partners do not look at public cloud and on-premise in isolation, but take a holistic view of their customers’ IT environments. “This will allow them to gain a wider understanding of their customers’ challenges and offer more comprehensive services by developing their own cloud offering and delivering a consistent, cloud-like experience,” he says.
Simmonds adds that “the role of channel partners is becoming more that of a consultant, providing not only the technology, but also insights” – for example, information on total cost of ownership (TCO) and return on investment (ROI) – that a hybrid approach can deliver. He believes that by delivering strategy while showcasing commercial advantages, channel partners can “succeed and grow in this space”.
For Brignone, the as-a-service theme will be particularly significant for standout channel partners in the future who recognise that everything as-a-service (XaaS) is about much more than financial concerns. “The value comes not just from subscription-style costing models, but from the full-service nature of the offering, where vendors and partners deliver a seamless business function that integrates perfectly and non-disruptively with other business operations,” he says.
Brignone advises channel partners to position themselves as trusted advisors who understand and are willing to learn about customer problems. “At the same time, they should be familiar with the technology available in the market so they can design and offer solutions that solve customer challenges,” he adds.
Keep up with the pace of change
Lenovo Infrastructure Group’s general manager, Ian Jeffs, says partners need to understand that the market is shifting, whether that be from spinning disc to all-flash. “The public cloud will continue to grow and many analytics, RPA [robotic process automation] and AI [artificial intelligence] solutions will increasingly be helping business leaders to make key decisions”.
Those that fail to recognise these trends will “fall behind at a time when digital transformation has never been more important”, he says, adding that “it is also important partners stay fluid in their approach to the market – after all, the only thing the IT industry can be certain of is change”.
Jeffs believes that “a consultative approach is always the best approach” for partners to take and an industry-specific approach can lead to even greater success, either by targeting vertical markets or by focusing on an industry-specific solution, such as using AI to help a manufacturing organisation simplify a product.
Chad Jones, EMEA senior director for channel at Park Place Technologies, agrees that “being consultative and offering choice is really the best role” for partners. “They can take on many roles – advocates, counsellors and decision-makers – and being in the driver’s seat when it comes to providing options and choice is really where the value is,” he says.
Strong relationships pay dividends
Another key factor is their ability to build personal relationships with customers. “As a partner, having long-lasting and deep relationships is incredibly valuable,” says Jones. Trust isn’t created overnight so if a partner has “a tenured relationship” with customers it can understand their ultimate goals and work with them to select solutions that help them achieve what they need.
NetApp’s Bryant believes there is a big opportunity for partners as more organisations investigate the viability of cloud operations. Many organisations lack the capacity to formulate and design a digital transformation and cloud strategy. Data management reliability, availability, protection, security, cost control and movement of data are key aspects of such a strategy, along with managing, maintaining and changing as business needs change.
“Partners need to market and validate their hybrid cloud expertise now. If they don’t act now, others will have hybrid cloud conversations with their customers. For those partners who fail to act now, the future may be uncertain”
Denise Bryant, NetApp
She identifies service design and deployment, consulting, managed services, migration of specific enterprise applications and workloads as just a few of the areas where channel partners can bring value-added services to help customers achieve competitive advantage in the cloud.
But partners need to engage customers in hybrid cloud conversations, build their own intellectual property and value-add services, solutions and propositions. “Most importantly, partners need to market and validate their hybrid cloud expertise now,” she warns. “If partners don’t act now, others will have hybrid cloud conversations with their customers. This means that for those partners who fail to act now, the future may be uncertain.”
Denworth says it’s important to understand there is no one size fits all. “Every customer has specific requirements and channel partners that have a dynamic range when it comes to providing different solutions are best poised to succeed,” he says. “It all comes down to fit, risk and cost. The most versatile channel partners will be the best positioned to tailor customer solutions to optimise for this equation.”
Some customers are more suited to help with validating new technologies than others. “Great channel partners complement their enterprise customer base with a mix of customer ‘pathfinders’ that partner with the channel to help flesh out next-generation architectures and solutions,” he observes. “These pathfinders are cultivated through a process of continuous innovation that is led by the channel.”
He can’t resist launching a broadside at legacy vendors that “have fortified their positions with end customers directly and have locked up channel partners by providing incentives and penalties for working with startups”, claiming that their “tired and saturated ecosystems are defined by process and red tape, but at the end of the day, customers are excited by practical innovation, and they demand modern solutions to modern business problems”.
James Mundle, global channel chief at Quantum, says partners should continue to expand their capabilities “and become even more tightly integrated with their customers”. By staying on top of the evolving technology landscape and recurring revenue models, he says “they will be able to deliver more robust and complete hybrid solutions to their customers”.
Mundle praises channel partners for providing tremendous insight, advisory services and more managed services to their clients. “By fully understanding the goals and aspirations of their customers and matching the rapidly changing technology to customer requirements, they can continue to demonstrate and deliver their unique value,” he adds.
Mundle says partners that fail to innovate and invest in their technological capabilities and business models “will be eclipsed by those who are proactively adapting to new business models, including subscription, as-a-service and recurring revenue streams”.