Wednesday, January 28, 2009

The Economy and Storage

By Mark Brousseau

The economic slowdown will be a reality through 2009, with overall IT spending growth falling from 5.1 percent growth in 2008 to 2.6 percent growth in 2009, according to IDC analysts who participated on a webinar today titled, “Worldwide Storage Top 10 Predictions.” IT spending will begin to slowly recover in 2010, with growth climbing to 4.5 percent, the analysts said, but a full recovery is not likely until 2011.

While the economy’s long-term impact on IT sectors will vary widely, all of them will struggle in the short run, the IDC analysts predicted. The worst hit will be the internal storage, tape, and high-end and mid-range server markets. The markets that will be least effected include security, systems software, and volume servers. IDC warns that some markets may never return to positive growth.

Against this backdrop, IDC believes users will demand greater storage efficiency, including:

… Block virtualization and thin provisioning (“must-haves,” according to IDC)
… Expanded use of data de-duplication
… Tiers for content with file virtualization
… “Greening” of storage
… Modularity/serverization for universal storage
… SAS as the standard interconnect used within external storage systems

Overall, IDC recommends that users “buckle up” as the industry is in the path of an economic hurricane. CIOs and line of business managers understand that money needs to be spent, IDC says, but are slowing purchases and need to do more with less budget. Controlling CAPEX expenditures will be a key requirement for our changing times, IDC says. For this reason, IDC predicts financing and leasing will emerge as a critical sales tool.

Similarly, storage promises to be a relatively stable segment during the economic downturn, but selling more efficient solutions will be critical. Showing quick return on investment is critical for selling solutions, and opens up additional services opportunities, IDC notes.

What do you think? Post your comment below.

No comments: