Software-Defined Data Center (SDDC) Market Set for an Exponential Growth Ahead

Software-defined data center (SDDC), also referred to as a virtual data center, is basically a data storage facility based on software where all the resources including storage, networking, and security are virtualized and delivered “as-a-service”. A secured user portal is provided by SDDC which delivers the data effectively by utilizing web-based servers. In addition, it also allows the end-users to access the data by making use of virtualization and cloud technology. Moreover, an advanced data management solution is offered by SDDC for monitoring and creating a backup of all the necessary information. Growing popularity of big data and cost-effectiveness has led to a high adoption of SDDC across multiple industries, such as BFSI, IT & telecom, retail, government & defense, healthcare, manufacturing, and others.

The global software defined data center (SDDC) market which is estimated to be valued at USD 25.61 Billion in 2016 is projected to reach USD 83.21 Billion by 2021, at a high CAGR of 26.57% during the forecast period 2016-2021. Among regions, the market in North America is predicted to have the highest share, whereas the market in Asia-Pacific is projected to grow at the highest CAGR, thus offering great growth opportunities for this market. This growth can be primarily attributed to the rising number of data centers in this region and the presence of developing nations, such as China, India, and Philippines.

Based on solution, SDC is the biggest market and is also garnering significant attention among corporates since it helps in gaining central control over entire data center. However, the market for SDN solutions is expected to witness the highest growth over the coming years.

What are the key factors driving and inhibiting the market growth?

The worldwide market for software-defined data centers is estimated to have an uphill trend over the forecast period, owing to the rising need for unified management and security and lower operational costs. It is growing at a rapid pace mainly due to the transformation from traditional data centers to advanced SDDCs, resulting in massive increase in data center traffic. This increased data center traffic and efficient use of data center resources has decreased the cost of in-house infrastructure, thereby leading to the high adoption of SDDC solutions across various industries. Moreover, increased spending pertaining to data center-related technology is expected to create ample growth opportunities for this market in the coming years.

However, problems due to integration of SDDC technologies with legacy IT infrastructure and increased pressure on business resources may hinder the market growth over the forecast period. Moreover, traditional data centers are facing problems regarding integration of servers, networks, and storage infrastructure within the data center, thus leading to the organizations finding difficulties in integrating SDDC technology with legacy IT infrastructure.

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What are the steps taken by the players for sustenance in this market?

The vendors in the SDDC ecosystem mainly comprise VMware, Inc. (U.S.)., Microsoft Corporation (U.S.), HPE Co (U.S.), EMC Corporation (U.S.), Cisco Systems, Inc. (U.S.)., Hitachi, Ltd. (Japan)., IBM Corporation (U.S.), Fujitsu, Ltd. (Japan)., NEC Corporation (Japan), and Citrix Systems (U.S.). These companies have been embracing different strategies to expand their global presence as well as market share. Partnerships, collaborations, acquisitions, and new product launches are some of the key strategies adopted by them to sustain as well as grow in this market. These companies are coming up with innovative SDDC solutions and products, owing to the emerging virtualization and cloud computing which has resulted in increased demands for advanced, proactive, and efficient virtual solutions. VMware and Cisco Systems are the dominant players in providing SDDC solutions and services. VMware plans on developing new products and solutions to attract customers from across the globe in order to strengthen their hold on the market. Cisco Systems, which is another major provider of SDDC solutions, is mainly investing and focusing on developing new software-defined networking related products, solutions, and service, resulting in a better portfolio for data center.

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