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3 Factors Pushing Indian IT Infrastructure Market to $3 bn by 2016

Gartner recently announced that the Indian IT infrastructure market comprising of servers, storage and networking equipment will reach $2.05 billion (approximately INR 13,500 crore) in 2012, a 10.3 percent increase over 2011. It also mentioned that this is expected to reach $3.01 billion (approximately INR 16,200 crore) by 2016.

This growth trend is despite the fact the most enterprises are no longer willing to over-provision infrastructure resources and are looking to consolidate their datacenters. “Indian IT organizations are making a big shift from a distributed IT setup to a more manageable and efficient centralized model, leading to consolidation of branch and remote IT resources into fewer, but larger data centers,” says Naresh Singh, principal research analyst with Gartner.

So what’s fuelling this growth?

Consolidation: According Gartner's research director Aman Munglani, the key growth driver for the data center market is this ongoing investment in large captive datacenters coupled with the capacity growth witnessed within the data center service provider space. The complexities involved in the disparate systems of existing datacenters impose quite a few challenges on the enterprises that want to consolidate their infrastructure. So much so, that in order to achieve ease of operations, organizations are even willing to compromise on some aspects of security. “It’s bit of a trade-off because in a decentralized environment the complexity and manageability of the infrastructure becomes a huge constraint,” says Munglani.

Service Providers: Munglani also affirmed that private cloud is a logical step forward for a lot of the organizations that are consolidating their datacenters. Some of the large organizations are already on that journey. This too drives the growth of the infrastructure market. “Though India is in the early stages of cloud adoption, cloud service providers will also be a key contributor to the infrastructure consumption, especially for commodity type, scalable technologies, such as scale out systems and extreme low energy servers,” says Munglani.

Business Growth: India is also witnessing a shift in the business’ view of IT. At large organizations IT is expected to be an able partner that proactively supports the business. “Improving customer experience, reducing time to markets, contributing to the bottomline as well as the topline, and the need for an agile infrastructure that enables growth are some of the broad trends today that lead to investments in infrastructure,” says Munglani.

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