The increasing demand for cloud computing infrastructure and IoT functionality will continue to drive the need for data centers of all kinds. These Hyperscale data centers offer unique ways of energy efficiency and functionality that will make them the preferred choice of facility for most companies. It is important to know what Hyperscale data centers mean for the future of IT.
The overall growth of the Hyperscale market has been dynamic. We can see emerging trends across Hyperscale data centers and these trends are driving the overall growth factor and these growth opportunities are putting multiple industry-laid approaches that can help the overall growth of the market.
According to Chandrasekhar Panda, Associate Partner- Digital Strategy, McKinsey, “The Global growth is average 18% year on year basis. In the context of India, we can see digital growth and Hyperscale market growing almost on a similar average. It is expected by 2025 that it will reach 25 billion in India.”
Overall industry perspective of Hyperscale market
There were 100 new data centers open in the last 8 quarters with 50+ of them coming in 2020. By the end of 2021, based on the lessons learnt in the pandemic, most of the organizations in Asia-Pacific and in India will put their IT mechanism and IT-strategy to accelerate their shift to cloud-centric data infrastructure and as well as application services twice as fast as before the pandemic hit.
Shantanu Preetam, Chief Technology Officer, PayU points out that by 2022, Hyperscale data center market will grow to $80 million. That is the compounded annual growth rate of 27 percent and most of this growth is seen in the Asia – Pacific region.
Preetam says that the global pandemic of Covid-19 actually spurred a record-breaking quarter of Hyperscale data centers companies. The data spreading in 2020 touched $37 billion. The number of large Hyperscale data centers actually increased to 600 by 2020 which is twice as many as two years back.
He says “Digital growth and acceleration are here to stay and grow. And with that reality, there is more and more need for leaders like us and all out there to embrace the technology and trends which will give organizations a competitive advantage. All of this will add to more and more demand for data centers and cloud infrastructure.”
Impact of overall demand that drives Hyperscale
Any industry vertical or company that is not involved in IT, digital or software to create an experience for consumers is missing out, pointed out Ravi Hudda, Chief Digital Officer, Raymond Limited. He says every company has now moved to be a software company. The key to this is how you build capabilities quickly when you are transforming into a legacy organization at a mass and large scale in the pandemic.
“It is important to understand that Hyperscale enables the most cost-effective approach to address the demand set of requirements. For example, a big data analytics project might be the most economically addressed today through Hyperscale and computing density,” Hudda says.
In terms of the ability of a technology architecture to improve and scale appropriately, he sees more demand is added to the system. Hyperscale is crucial to construct a strong scalable demand system across organizations.
Chander Chander Khanduja, Chief Information Officer, Luminous Power Technologies says now cloud computing is not just about data storage, it is also about application performance, social media performance and analytics performance.
So now, with Hyperscale you have flexibility, scalability and affordability available. These three aspects are game-changers in terms of making Hyperscale a technology of choice in many companies. Now, technology is not limited to how you are able to have different computation power but most importantly how you are able to bundle in the entire experience and how you will offer a faster go-to marketing strategy to your marketing teams.
Ashok Jade, Group Chief Information Officer of Spark Minda says that while currently Microsoft, Amazon and Google are dominating the market, Indian companies too have a big opportunity.
“Though it will be very challenging for small players to come into the market, mid-size players can jump in and grab larger market share.” There has been a substantial investment in server security, data protection and a substantial investment to follow law of the land. However, the government has identified these things and are putting their norms very strongly. And because of the norms, in near future, the revenue model and dynamics will also change. With the governments’ help, new mid-size players will come to the market and change the market.”
Overall growth opportunity & tactical changes
India’s current data center market is about 400 megawatts and out of that, 120 megawatts is consumed by the hyperscalers alone. “When I say 120 megawatts is used by Hyperscaler, 70% of it is going out. This size is actually 350 megawatts. Hyperscaler operates in a very structured manner. They have got 3 data centers known as the availability zone. Some use 10 km area, some use 20 and some use 50 km area. This topology has got a critical factor in having a very robust fibre infrastructure,” Sanjay Bhutani, Senior Vice President, Adani Connex said.
Because of the pandemic, and cloud adoption happening at a much faster pace, in India, 15 percent of companies have adopted cloud computing and 20 percent of workload has been migrated to the cloud. The data center growth will be 25- 27 percent by 2030 and this will reach about 1500 megawatts, he says.
The Data Privacy Law is also going to make some big changes in the industry.
Talking about connecting to outside India, Bhutani says, so far, the cable coming to India was commanded by the Majority of Telcos. Now, hyperscaler themselves are participating in building the cables. Scalability has been a challenge in India which is getting addressed by newer players.
Data is getting thicker day by day and that’s why you can’t move data from one place to another. And the newer way of making data centers is we have to decentralize these data centers. The three layers of the data center- data center park, edge data center and micro-data center are going to come and take care of a complete chain.
