12 Jul 2016

According to International Data Corporation’s (IDC) Asia/Pacific Quarterly Enterprise Storage Tracker, India external storage market witnessed a de-growth of 5.5 percent year-on-year (in vendor revenue) and stood at 65.6 million dollars in Q1 2016. However, capacity (TB) shipped in Q1 2016 saw a double digit year-on-year growth due to decrease in $/GB.

The enterprise storage market was largely driven by Banking, Professional services and Telecom organizations in Q1 2016. However, the quarter witnessed a slowdown in Telecom spending while professional services, Resource and Education sectors had huge year-on-year growth in their storage deployments.

Increased adoption of All Flash Arrays (AFA) was seen across verticals due to better performance at an affordable price. Recent technology advancements in flash has resulted in decreased prices thereby lowering the total cost of ownership. Workloads like VDI (virtual desktop infrastructure), OLTP (online transaction processing), DB (Database), real-time analytics are constantly finding traction for Flash storage across verticals.

Technologies like Software-Defined Storage and Hyper Converged Infrastructure are expected to cannibalize traditional external storage market and is expected to have a large impact in the next couple of years.

Growth is expected in banking sector in H2 2016 due to large pending technology refresh projects. Surveillance is expected to be the key contributor for the storage market growth. All the leading players are facing tough competition in the market due to intense price war from small storage players.

According to Dileep Nadimpalli , Senior Market Analyst, Storage, IDC India,

“We are expecting increased spending from 3^rd party datacenter players and cloud providers due to increased demand for cloud hosting services. Across verticals, organizations are opting for cloud not only for ease of management and cost advantage but also for faster time to market.”

Gaurav Sharma , Research Manager, Enterprise & IPDS, IDC India says,

"Flash storage is essentially becoming the (top of the mind) answer to customer's infrastructure performance issues. With advancements in technology, vendors lowering the price bar, competitive bundles on offer and fanned out solutions for various segments and verticals, the flash market is expected to further generate demand."

Major Vendors Analysis:

• EMC continued to lead the market but witnessed a drop in its market share from 33.8 percent to 28.4percentin Q1 2016 year-on-year

• Dell had significant growth due to uptake from professional services organizations in Q1 2016.

• HPE also witnessed significant growth due to the uptake of 3PAR portfolio across verticals in Q1 2016.

• Small storage vendors and white box players are slowly gaining traction in SMB manufacturing units and media houses as well.

IDC India Forecast:

The external enterprise storage systems market is expected to grow in single digit in terms of compound annual growth rate (CAGR) for 2015–2020. Banking and Government sectors are expected to drive huge storage demand in the coming quarters. Emergence of SMAC technologies across verticals would enable demand for new storage technologies in near future.