The 10 Biggest Data Center News Stories Of 2018

The Most Important In The Data Center

No, the public cloud did not kill the data center as some believe it could have heading into 2018. Not only was the data center alive and well in 2018, but worldwide spending on data center infrastructure like servers, storage and networking was booming throughout the year.

2018 was arguably the year of the software-defined data center, which saw an incredible amount of automation and artificial intelligence R&D being infused to create the next generation of scalable and flexible data centers. It was a groundbreaking year for data center leaders Dell Technologies and Hewlett Packard Enterprise, with Dell taking the worldwide sales lead and HPE doubling down on composable infrastructure.

CRN breaks down this year's 10 most important stories in the data center.

10. Amazon, Google And Facebook Rapidly Expand Data Center Footprint

Technology giants Amazon, Google and Facebook all rapidly expanded their data center footprints in the U.S. and around the globe in 2018. The three industry titans accelerated data center construction around the world and were some of the top data center infrastructure buyers this year as they seek to meet increasing data and cloud demands. Amazon now owns 57 data centers in 19 regions globally, including the opening of a new center in Sweden this year. Amazon also unveiled plans to build three new centers in Italy and its first facility in Africa by 2020. Social media giant Facebook expanded its data center push this year, increasing the amount of centers in Nebraska from two to six, unveiling its ninth state-of-the-art facility in Georgia, and unveiling plans to build an 11-story, 170,000-square-foot data center in Singapore. As Google Cloud gains traction in the cloud marketplace, the company has been on a global data center expansion tear this year, opening its first Cloud Platform center in Montreal and unveiling plans to open three new data centers in Switzerland in early 2019. Each company will most likely continue to pour billions into new data centers next year.

9. HCI Hits Mainstream

The hyper-converged infrastructure (HCI) market matured at a blistering speed in 2018 with annual revenue hitting an all-time high, including $1.5 billion in sales for the second quarter, up a whopping 78 percent year over year. HCI offerings made substantial inroads into a broader set of use cases and deployment options this year. The innovation engines were roaring as vendors like Nutanix, Dell EMC, Cisco, Pivot3 and HPE expanded their strategies to better embrace hybrid and multi-cloud and provide more compute-only, storage-only and software-defined networking options. HCI is reducing data center complexity and being leveraged more to support business-critical enterprise applications from companies including Microsoft, Oracle and SAP. Demand for HCI will undoubtedly continue to increase in 2019 as server, storage and networking silos begin to fade away.

8. Dell Technologies Goes Public

The data center infrastructure leader is set to become public on Dec. 28 after spending after spending nearly all of 2018 maneuvering and negotiating the best way to do so. Dell's public battle, which spanned lawsuits, bickering from investors and a revised shareholder deal, began all the way back in January. New reports steadily flowed in throughout the year around whether Dell could win shareholder approval or how the company might seek different routes to the public market, even enlisting banks for a traditional IPO. At one point, activist investor Carl Icahn—who owns a sizable stake in both Dell and VMware tracking stock—sued Dell and said the company was creating a "fear campaign" to win shareholder approval. However, after months of heated public statements by Icahn, the investor threw in the towel. Channel partners say the new Dell Technologies will allow for greater R&D spending, as well as tighter integration and innovation alongside VMware.

7. Nutanix Becomes A Force To Be Reckoned With

2018 was a revolutionary year for the hyper-converged infrastructure pioneer, as Nutanix shifted to a software-centric company, launched new innovations and consistently delivered strong sales growth. Implementation of HCI solutions in the data center exploded in 2018 and various research analysts and reports showed that Nutanix was leading on the innovation front. The company received the highest score for hyper-converged technology from Forrester and was named a leader in Gartner's first-ever Magic Quadrant for Hyper-Converged Infrastructure. Facing technology giants like Dell, HPE and Cisco in the hyper-converged space, Nutanix not only competed, but didn't shy away from a good fight. With Nutanix targeting $3 billion in software and support billings by 2021, the company is looking to become a staple in the software-defined data center in 2019.

6. IBM $34 Billion Red Hat Bet Has Big Data Center Implications

Big blue has been a one-stop shop for data center solutions for years, but injecting Red Hat's highly popular open-source software creates a more intriguing data center provider. Red Hat has significant influence across the data center with Red Hat Enterprise Linux being one of the most popular Linux distributions. With Red Hat's OS available on public cloud as well as it being a key participant in the OpenStack ecosystem, the IBM merger has all sort of implications in the data center market, including turning up the heat on Dell Technologies and HPE. The deal is intended to leap frog IBM into the front of the hybrid cloud universe. "We have been shaping IBM for this moment," said IBM CEO Ginni Rometty. "IBM will become the world's No. 1 hybrid cloud provider, offering companies the only open cloud solution that will unlock the full value of the cloud.”

5. Power Vendors Push Software And Services

Data center power leaders APC by Schneider Electric and Eaton flexed their software and services muscles in 2018, launching technologies to help solution providers generate new recurring revenue. As greater demand for edge computing and the Internet of Things services heats up, power management providers branched out with Software-as-a-Service platforms around life-cycle management for customer data center and distributed environments. Eaton focused on provider power management as-a-service, while APC by Schneider Electric jumped into the hyper-converged infrastructure market through a partnership with Scale Computing to deliver a new "micro data center in a box". This year was a breakout one for innovation from data center power vendors whose R&D is focused on driving new software capabilities and creating more cloud-based versions of legacy product lines.

4. HPE Steps Up Composable Infrastructure Charge

HPE doubled down on composable infrastructure this year with the launch of HPE Composable Cloud for Synergy. HPE also injected its composable technology into its hyper-converged infrastructure offering SimpliVity, which included a breakthrough composable mesh network fabric. The company's new Composable Cloud offerings provide customers the ability to compose any workload across any cloud and support the full HPE software stack, including built-in artificial intelligence from HPE InfoSight, HPE OneView and HPE OneSphere. IT research firm Forrester said composable infrastructure will become the predominant approach to computing in the software-defined data center of the future. Composable infrastructure allows storage, compute and network products to act as fluid pools of resources that can be provisioned for optimal performance depending on the workload requirement. HPE will have some new competition in the market in 2019, as Dell EMC recently unveiled its PowerEdge MX modular platform.

3. Rise Of Software-Defined Data Centers; Public Cloud Not The Answer

In the beginning of 2018, some believed that the public cloud signaled the demise of the data center. As the year comes to a close, nothing could be further from the truth as seen by public cloud titan AWS preparing to launch its own data center hardware next year. (More on AWS in the next slide.) The demand for new servers, storage and converged offerings remained high throughout 2018 as innovations like artificial intelligence and automation gave rise to the software-defined data center (SDDC). With high pubic cloud bills hitting businesses, many repatriated public cloud spending to SDDC offerings this year. According to a 2018 IDC survey, 80 percent of IT-decision makers migrated either applications or data that were primarily part of a public cloud environment to an on-premises or private cloud due to security, performance and cost concerns. These new software-centric centers are making life easier for manufacturers and solution providers while also unleashing new data and analytics opportunities.

2. AWS Hardware Coming To A Data Center Near You

AWS shocked the hardware world with the unveiling of AWS Outposts. The public cloud leader will dive deep into the on-premises world with an integrated hardware rack of compute and storage which can run native AWS or VMware environments that can connect to Amazon's public cloud. AWS CEO Andy Jassy said the genesis of Outposts came from customers wanting to extend their AWS or VMware Cloud on AWS environment on-premises using the same hardware, interface and APIs that Amazon was leveraging. "We tried to reimagine what customers really wanted when running in hybrid mode and developed AWS Outposts," he said. Amazon plans to deliver, install and do maintenance and repairs on Outposts, which is raising some concerns from the channel community. Although many questions still remain and Outposts won't be available until the second half of 2019, you can be sure that AWS will make some type of splash in the data center market next year.

1. Dell Technologies Becomes The Data Center Force

There is no question that 2018 was a critical year for Dell Technologies as the company solidified itself as the global leader in servers, storage and hyper-converged infrastructure. The push began when the company injected a whopping $2 billion into its storage business to wage an all-out assault on the market this year. Along with a new simplified storage portfolio and go-to-market strategy implemented by Michael Dell's (pictured) right-hand-man Jeff Clarke, storage sales flourished for Dell in 2018. The company also took command of the worldwide server market in 2018, besting HPE. Dell and VMware were also the hyper-converged infrastructure market-share leaders this year, which bodes well for Dell's data center infrastructure market share in 2019 as HCI will continue to gain more market traction. With Dell Technologies becoming a public company, the future is bright for the vendor, which looks to continue supremacy in the data center.