10 Storage Predictions For 2017
Top Of Mind In 2017: Think Fast Or Be Lost
The storage industry is being racked by a sea of changes as solution providers explore new ways to store and manage data. And by "new," we really do mean new, as in widely deploying technologies which a couple years ago were only dreams. Technologies such as flash storage, software-defined storage and the cloud are not just doing the work that racks and racks of hard drives used to do. They are doing that work faster with significantly lower capital and operating costs, and enabling businesses to streamline operations in ways they never thought of before.
That kind of change has its price, however, as storage vendors struggle to keep up with the fast pace of development and solution providers struggle to place their bets on the right horse.
Well, there is no single right horse to choose. Solution providers and their customers will be forced to place multiple bets. Here's a look at some of the changes that can be expected for 2017.
1. Overall Storage Sales To Fall
Storage revenue started to show a consistent downward trend in 2016 despite the surge in sales of all-flash storage solutions, according to IDC and other research firms. That trend will continue in 2017. Watch for customers to increasingly move away from disk-based or even hybrid disk-flash storage toward the cloud and all-flash storage solutions.
Predicting an overall drop in storage sales is pretty easy. It is also a foundation to keep in mind as we look at the other key trends that can be expected in 2017.
2. Cloud Storage Will Accelerate Quickly
Businesses in 2017 will increasingly see the merits of cloud storage. But it won't be because the cloud is a good place to run applications, or less expensive than on-premises storage. It's neither.
The cloud will be the go-to technology for data protection and disaster recovery, and for capacity surges to meet temporary demands for applications requiring temporary space. With the rise of DevOps, containers and similar technologies, the cloud is also the place for developing and testing applications before moving them to production.
It also helps that the major cloud vendors, especially Amazon Web Services, Microsoft and Google, are making it easier for third-party companies and channel partners to build gateways to help customers take advantage of the cloud for managing data.
3. Flash Storage Sales To Bloom
The storage industry in 2017 will see the majority of storage capacity sold in all-flash storage solutions, and not on disk. This is due to the continuing downward spiral of flash storage media costs combined with drops in overall costs connected to operating flash storage versus disk storage, including lower power and cooling costs and fewer support issues.
Watch for storage capacity to be big news in 2017, with 32-TB and 64-TB drives coming to market in 3.25-inch form factors, and more 2.5-inch form factor flash drives breaking the 20-TB mark.
Solution providers, on whom much if not the majority of storage sales depend, have started adjusting their sales strategies accordingly. Already, a handful are selling only all-flash storage solutions, and it's an easy bet to assume a half or more of such companies will convert to all-flash sales in 2017.
4. But NAND Chip Shortage Will Worsen Before It Gets Better
In 2016, the storage industry saw the beginnings of a shortage of NAND chips, a key component in building SSDs. 2017 will see that shortage grow significantly before the situation improves.
SSDs take about 40 percent of the NAND flash chip production, according to DRAMeXchange, a division of Taiwan-based analyst firm TrendForce. DRAMeXchange reported late last month that it expects NAND flash manufacturing capacity to rise only 6 percent in 2017 as manufacturers shift production from 2-D NAND to 3-D NAND. However, the firm reported, more than 50 percent of notebook PCs are expected to ship with SSDs by late 2017, and demand for enterprise-class SSDs in storage arrays and servers will grow quickly, leading to price increases for SSDs even as sales of flash storage solutions continue to grow.
5. Fibre Channel Begins To Fade
The three primary providers of Fibre Channel -- Emulex, QLogic and Brocade -- are no longer individual companies, and the speed of Ethernet, which is much easier to work with, is advancing by leaps and bounds.
It may be time to predict the coming end of Fibre Channel. No, it won't disappear completely in 2017, as there are still enough legacy storage arrays in the market using the connectivity solution. But 2017 will see it move to the precipice of irrelevance as customers turn away from hard disk-based storage toward all-flash storage and the cloud, neither of which requires Fibre Channel networks.
6. Servers For Storage
Server sales in 2016 also took a hit, but demand by hyperscale data centers could bring growth back to the industry in 2017. However, whether total server sales continue to grow or fall, more and more of those servers will be targeted at storage solutions in 2017. This may be from an increase in the sales of software-defined storage, or the increased use of flash storage in servers to directly run applications, or in technology to share flash between multiple servers. Or all three.
But the key takeaway for 2017 is that servers will be increasingly used in place of, and not on top of, storage.
7. The Storage Industry Will Consolidate
The storage industry already had its first acquisition in 2017, that of Exablox by StorageCraft. It is a fast start to what will likely be a big consolidation of the industry.
While some consolidation moves, like Exablox, are driven by a need to expand technology or markets, 2017 could see the closing of several smaller storage vendors that are not able to move quickly enough to meet the changes going on in the industry. This will include hard drive-based storage vendors that will see that part of the business shrink before they can take advantage of the shift to flash storage, as well as some flash storage vendors unable to develop software capabilities quickly enough or that cannot otherwise compete with large vendors that are growing quickly.
8. Hyper-converged Infrastructure Will Mature
The hyper-converged infrastructure market, while fast-growing, is still characterized by the startup nature of its vendors. Yes, there is VMware, but that company early last year killed its original product line, EVO:Rail, and is now pushing hard to bring its VxRail, VxRack and VSAN lines to market dominance. And yes, there is Nutanix, but since its IPO that company has seen losses grow with revenue. Nearly everyone else is in startup growth mode.
Something has to give. 2017 has already seen a big change with HPE's planned acquisition of SimpliVity. Look for a couple other vendors to drop out or get acquired, all part of the natural progression of a new technology that has already proven it has legs. Now to see which vendors have legs.
9. Dell EMC: No Change, For Now
The new Dell EMC has a lot of things to do in terms of product line consolidation. There will be some changes, some transitions, and the dropping of a couple minor products. But expect no major restructuring of products. Dell EMC in 2017 will instead focus on pedaling furiously behind the scenes to prepare its software-defined strategy.
10. NetApp At A Crossroads
More than ever, the future of NetApp will be a burning issue in 2017. NetApp in 2016 showed signs of recovery from legacy issues that dogged it in the past, including readying strong cloud and all-flash storage strategies and moving past the difficult transition to its Clustered Ontap. And it seems to be on the road to solid growth for the first time in years.
But can an independent storage vendor, even the largest, NetApp, stay independent? With Dell's acquisition of EMC in the history books, NetApp is the only independent storage vendor of all the top vendors. And this is in a world where storage is increasingly tied to server infrastructures, or to the cloud, or anywhere where it is not as part of a traditional SAN. So look to NetApp being courted by a dwindling number of vendors that need a storage strategy, including Cisco, Oracle and Lenovo.