Data Centre Market Expected to Accelerate Owing to Increasing Cloud Demand

An enormous amount of data is generated daily through various medium and amid this their storage becomes a great concern for organizations. Currently, two significant styles of data storage capacities are available – Cloud and Data Centre.

The main difference between the cloud vs. data centre is that a data centre refers to on-premise hardware while the cloud refers to off-premise computing. The cloud stores the data in the public cloud, while a data centre stores the data on company's own hardware. Many businesses are turning to the cloud. In fact, Gartner, Inc. predicted that the worldwide public cloud services market has grown to 17.5 percent in 2019 to total US$214.3 billion. For many businesses, utilizing the cloud makes sense. While, in many other cases, having an in-house data centre is a better option. Often, maintaining an in-house data centre is expensive, but it can be beneficial to be in total control of computing environment.

Sometimes the best solution is a hybrid of cloud and data centre. Many organizations find that using their data centre for critical data and using the cloud for less confidential information works well. Because the cloud is so easily accessible and scalable, using the cloud for additional capacity might be a good solution for some organizations.

However, as noted by Wall Street Journal, Cloud demand is driving Data Centre Market to new records.

US businesses last year paid for a record-high 396.4 megawatts of power in the country's largest data centre markets, up 33 percent from 2018 amid soaring demand for cloud services, according to a report released by real estate services firm CBRE Group Inc.

Amazon.com Inc., Microsoft Corp. and other large cloud services provided the bulk of that demand, but many companies reluctant to shift all of their data to external systems also ran their own data centres, either in-house or in warehouse-sized spaces leased by third-party data centre facilities that are known as co-location services.

Pat Lynch, senior managing director of CBRE's data centre division said, "Insurance, financial services and health-care companies, among others, are the most likely to keep using their own purpose-built facilities."

Colocation services rent physical space for companies to store their servers and other data centre hardware. The facilities typically house racks of servers and other hardware, which can be costly and inefficient for companies to manage themselves.

By contrast, cloud services operate their own data centres, renting computing capacity to businesses on a pay-as-you-go basis. In North Virginia, the world's largest data centre market, cloud services last year accounted for roughly 200 megawatts of total data-centre demand, compared with nearly 50 megawatts by co-location services or in-house systems.

Other areas with large data-centre markets include Silicon Valley, the Dallas-Fort Worth region, and New York, New Jersey and Connecticut.

Over the past five years, cloud services have supplied a growing share of data-centre use, while the supply by co-location or in-house systems has remained roughly steady by comparison, according to the report.

It has been estimated that, the global number of data centres owned and operated by cloud service providers, colocation services or other technology firms rose to roughly 9,100 last year, up from 7,500 in 2018. The number is estimated to top 10,000 this year.

There were also about 28,500 data centres last year owned by companies outside the technology sector used for running information-technology systems, down from 35,900 in 2018, IDC said.

Rather than shut down their data centres altogether, most companies have adopted a hybrid approach to cloud computing by using multiple cloud providers in addition to their own internal systems. That way they can avoid getting locked into any one outside vendor as prices and capabilities shift across the cloud-services market, IT research firm Gartner Inc. says.

Many companies also remain wary of turning over sensitive data to outside services, especially firms in highly regulated industries such as finance or health care, Gartner says.

As demand for hybrid capabilities grows, many of the market's largest cloud-service providers have unveiled tools aimed at helping companies run systems in the cloud and in their own data centres.