The cloud era, what the future of data centers looks like

Data centers have played an increasingly important role in helping businesses sustain themselves during the pandemic. This role certainly becomes critical with the growth of the economy in the future as organizations dive deep into digital transformation.

Data, everything and everyone is kind of data in one way or another, the data of the world, so it’s important to understand the power and reach of data centers that manage and make sense of those data. In essence, data centers have been synonymous with computers since their existence in more ways than one. Now this data has grown so much that we need data centers and cloud to help collect, store, evaluate, organize, protect and transfer this data as needed from one part of the earth to another.

Data centers have the capacity to do so much more than that, and during the pandemic, businesses have realized their true potential and true value. Due to COVID 19, digital transformation has received a major boost and has led businesses to best embrace this wave of digitization.

Cloud adoption has truly given businesses a second chance to innovate, improve, and create impact to thrive. Although this wave does not stop there, the cloud and data center industry is set to grow and proliferate with innovation and technological advancements in business and in our daily lives.

Post-pandemic transition

Shortly before the pandemic, traditional enterprise-operated data centers were set up to manage IT operations internally. To support functions that could not be handled off-premises, but were also within budget, organizations preferred on-premises configuration.

Today, the scenario is quite different, organizations are turning to cloud, MSPs or colocation service providers which are more advantageous in terms of cost efficiency, operations, flexibility and even security. In a cloud, the configuration business can benefit from storage capacity and scalability.

For small and medium-sized enterprises (SMBs), the cloud is an eminent choice because they lack the manpower and finances needed for an on-premises setup. In this growing economy, organizations are redefining business strategies that are in line with the current market scenario and technological advancements. The availability of data centers and consistent quality of service that was maintained during the pandemic when demand was higher has helped several businesses sustain and thrive. In 2020, the data center market was estimated at $48.9 billion. By 2026, this estimate will see the data center market rise to $105.6 billion.

Growth Drivers

Digitization of the current process, due to the pandemic, companies have realized that some processes can be done digitally, saving time and effort

SMEs are turning to digital technologies

The industrial sector more focused on digitalization

The boom in Over-the-top (OTT) platforms, as more and more entertainment platforms emerge

Rise of advanced technologies such as Internet of Things (IoT), Machine Learning (ML) and Artificial Intelligence (AI)

Power, Networking, and Downtime

Data centers can also be considered as server farms, which perform critical functions such as data storage, recovery and backup, data management and analysis, and finally networking. Data centers run on so-called power distribution units (PDUs), along with UPS, these components ensure an uninterrupted, clean and efficient power supply. In order to avoid situations of disturbances or power cuts, the UPS makes data centers possible.

With the help of reliable power sources, data centers can run smoothly. Internet usage is increasing rapidly and with it the demand for data storage, making it important to avoid situations such as outages or downtime. According to a recent study, more than 70% of data center outages are caused by human error.

Downtime can cost a fortune to organizations that are quite difficult to recover and get back to normal. Therefore, for businesses, data center infrastructure is a crucial and key element when transitioning to the cloud. In 2019, the global data center infrastructure market forecast was $94.56 billion, this figure is expected to increase further and reach $142.31 billion by 2027, according to reports.

Safety – The Top Priority

Today, data is considered the most valuable asset for any organization or even an individual. As technology advances, the value of data will continue to increase.

Security is a major concern for data centers because they contain tons of crucial data. In order to protect and retain this valuable data, data centers and organizations have compliances, policies, and safeguards in place. Since everything is going digital, we are more prone to cyberattacks, hacks, data breaches, viruses, and other disasters. Businesses and IT managers are investing heavily in manpower, tools, and software with the help of finance and experts to ensure data safety and security against cyberattacks. Organizations need to have a solid technology foundation along with an intelligently planned data center management strategy for smooth operation.

The Asia-Pacific region has the highest demand for data centers in the world, thanks to the major shift to the work-from-home system during the lockdown, which increases data traffic. Such demand drives data center service providers to improve their data center infrastructure and evolve according to the latest market trends.

With the introduction of the 5G network, developers and organizations will swoop in to deliver single-digit millisecond performance time to their consumers through their apps. 5G is about to change and innovate the whole connectivity game. Automation is another key driver of cloud growth, due to the pandemic everything had to be digital and less to minimal labor usage.

By adapting to AI and robotic process automation (RPA) solutions, the data centers of the future will work. As we approach the depth of digital transformation, organizations are developing strategies that meet the growing demands of their consumers.

Today’s consumer is smart and will be much smarter in the years to come, unafraid to explore, experiment and seek out smarter solutions to make life easier. In this competitive market, businesses want to thrive and be on top of their game. When migrating to the cloud, businesses and IT managers should look for service providers that constantly evolve in step with market trends and meet their needs. Profitability, flexibility, scalability, etc. are all key elements for companies to move to the cloud, but in the future, this demand will increase in terms of quality and agility and data center service providers must be ready for this change.

Ramon J. Espinoza