That’s according to market research firm Gartner, which estimates that although the data centre market seems poised for growth, existing assumptions will be challenged.
Vendors like the 50 percent or more gross margins in storage and networking hardware and software but one vendor might decide to slash its margins, so forcing a price war in the data centre industry.
Traditional data centre firms will also face disruption from cloud computing which will reduce the demand of for total amount of compute to total workload. And Amazon, Google, IBM, Microsoft and Baidu are offering platform as a service, with the existing companies failing to offer something equally compelling.
Thirdly, economic warfare between the BRICS countries – Brazil, Russia, India, China and South Africa will largely increase competition in the data centre infrastructure market.
Last, Gartner thinks that buyers will come to regard multinational providers as untrustworthy. Also there is an increase in small white box assemblers.
Gartner believes that while Intel, AMD, Western Digital and Seagate will sit pretty for the next fee years, the first two will see erosion from ARM and other architectures. Storage will shift to flash.