Cloud Storage: See You Next Year

If cloud storage was one of the few bright spots in IT in 2011, the trend is likely to continue through 2012, for many of the same reasons, analysts and vendors say. Predictions for 2012 in the area of cloud storage include continuing support by small and midsize businesses; improved linkages among public cloud services, private cloud services and local storage; reduced costs due to increased competition; and revenue projections of more than $1 billion for Amazon Web Services alone. All these are developments that could end up threatening legacy storage hardware and software companies such as EMC.

Carl Brooks, analyst for infrastructure and cloud computing for Tier1 Research, predicts an increase in "cloud gateway" products that let users tie into public cloud storage services, as well as provision local storage in an automated way, citing Nirvanix as an example. "The company partners with data center operators and gives them a small storage appliance that has local storage and ties into Nirvanix's own cloud infrastructure service outside the individual data center," he says. "Nirvanix does all the management, the data center gets local cloud storage on the cheap, and Nirvanix gets revenue sharing and new customers."

The same is true on the private cloud storage side, Brooks says. Enterprises in 2012 will demand cloud storage that can be hybridized with public storage services, and can shift data between tiers and offload non-critical data to long-term cold storage on the public cloud, he says.

Small to midsize businesses will continue to embrace cloud storage in 2012, says Dick Csaplar, senior research analyst, virtualization and storage, for the Aberdeen Group. They do not have the luxury of multiple locations to provide offsite data protection, so renting that from a cloud provider makes sense, he says, adding that he believes storage pricing will get more aggressive as public cloud providers get more efficient, economies of scale kick in, and competition heats up.

The result could threaten traditional storage vendors such as EMC, even if, as the name "cloud" implies, the workings of the cloud storage service might be a mystery to users. "Who wants to buy a few hundred-grand’s worth of EMC or similar when they can get cloud storage for customers at a fraction of that price and not re-invent the wheel to boot?" says Brooks.

"At this point, customers are usually fine with not knowing much about their infrastructure. EMC and the other legacy storage providers are going to feel the pinch from more able, more modern storage systems vendors and will have to sweat a few bullets as they update their flagship lines. As cloud computing techniques continue to become mainstream, enterprises are going to be very demanding of their vendors. Simply parking an array in the data center is no longer good enough. Customers want true, fully virtualized, automated and discrete cloud storage solutions with APIs and hybrid capabilities. 2012 will see them flip the script and hold their vendors hostage for improved solutions, instead of the other way around," says Brooks.

See more on this topic by subscribing to Network Computing Pro Reports Strategy: Cloud SLAs (free, registration required).