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While data center budgets rebounded last year after major cuts in 2009, IT shops focused spending on areas where they can get the most return on investment, according to SearchDataCenter.com's annual Data Center Purchasing Intentions Survey of 1,049 IT professionals.
In 2009, 40% of U.S. data centers surveyed faced budget cuts, and 20% of respondents faced budget cuts of more than 10%. But this year only 20% of data centers anticipate budget cuts. In fact, nearly half (46%) of 887 IT shops responding said their data center budgets will increase.
It's difficult to ascertain whether these increases will just bring budgets back to pre-2009 levels or represent a true return to growth, but it's clear that IT executives' purse strings are loosening a bit.The key takeaways from this year's data are the following:
- Windows OS and virtualization spending. The Windows Server operating system and virtualization implementations have driven IT spending in 2010 (50 percent will increase spending on Windows OSes; 59% will expand virtualization deployments).
- Spending on infrastructure. Green IT has receded somewhat from the IT agenda (only one-third say it's "very important"), but IT shops continue to spend on data center infrastructure.
- Cloud computing adoption. Public cloud computing adoption is slow (only 8% have or will implement public cloud in 2010), mainly because of security and compliance concerns.
- Systems management tool spending. Compared with 2009, systems management spending tripled in 2010 among U.S.-based respondents (27% of respondents will increase spending, compared with only 9% in 2009).
Server hardware trends for 2010
The survey asked IT managers to compare spending on various server form factors between 2009 and 2010. Spending on large symmetric multiprocessing (SMP) machines (those with more than 16 cores) remained fairly flat. Some 60% of respondents do not use SMP boxes, and 25% are spending the same or less on the machines in 2010.
The 8-to-16 core server, blade servers, and rack servers with four cores or fewer showed growth, with 25% of users saying they will increase spending on commodity hardware.
The percentage of IT shops that do not use blades is noteworthy. Between 2008 and 2010, one might expect the percentage of data centers using blades to increase, but instead the number of shops that said they do not use blades increased, if only slightly: 41% in 2010, compared with 39% last year. So many IT shops haven't embraced the promise of blades' reduced power consumption and eased management. Their higher cost and heat problems have only fueled IT shops' tendency to stay with rackmount servers.
"Vendors are still selling blades at a premium," said analyst Charles King of Pund-IT Inc. "When funds are tight, you suck it up and keep buying what you know and understand. If I can get 20-30 more rack servers for the price of a blade enclosure, I'm going to stay with the rack. If vendors wanted blades to take over the market, they'd have to sell them very close to the price of rack products, and that doesn't seem to be a direction they're going."
IT professionals focused on small and medium enterprises echo that sentiment.
"That stuff was expensive," said Gentry Ganote, the CEO at Rojoli Technologies, a managed services provider in Norcross, Ga., who used Hewlett-Packard blades at a previous company.
"I went from a $150 million company to a small company where every dollar counts," he said. When it comes to blades, "the entry point is just too high," he said. "The larger companies can afford [them], but once you saturate the Fortune 1000, smaller companies don't necessarily need that kind of density [that blades provide.]"
On the other hand, the IT director of a large Midwestern financial firm said that he sees no downturn in spending on blades -- at least among the largest companies --although he acknowledged that a shift of computing loads to "XaaS platforms" (or Anything as a Service) may have an impact.
"As far as I know, most hosters still use discrete servers [non-blades] because I/O is easier to manage," he noted.
In 2010, 887 data center managers said existing vendor relationships, hardware performance and price were the main factors considered in choosing a server vendor.
This year the top drivers for new server purchases were the following:
- increasing capacity,(46%)
- enhancing virtualization capabilities( 42%)
- replacing servers hitting end-of-life (39%)
- supporting new applications (38%)
- improving server efficiency(25%)
- reducing floor space and server consolidation (24%)
The typical amount of RAM provisioned on a server also increased, largely because of server virtualization. On average, around 20% of respondents provision 8 GB per server, 18% provision 16 GB, and 17% provision 32 GB of RAM per machine.
Also, converged data center infrastructure, as touted by Cisco and HP, has yet to inspire many users. Seventy-six percent of respondents have no interest in converged infrastructure such as Cisco's UCS or HP's BladeSystem Matrix. Those data centers that do use such converged hardware cite better performance, more automated management and easier integration as the main drivers.
Data center operating systems
IT managers were asked to compare 2010 spending on various operating systems compared to 2009. Among 886 respondents, Windows Server experienced the most growth, with 50% of respondents increasing spending on that server operating system, while only16% decreased spending. Linux growth was second highest, with 36% increasing spending, and 8% decreasing. Spending remained flat for legacy Unix, mainframe and iSeries platforms.
Among 1,023 respondents, their IT shops had the following operating systems installed:
- Windows Server 2003 (78%)
- Windows Server 2008 (51%)
- Windows Server 2008 R2 (42%)
- Red Hat Enterprise Linux (40%)
- Sun Solaris (25%)
- IBM AIX (22%)
- HP-UX (18%)
- i OS (i.e., i5/OS) (16%)
- SUSE Linux (15%)
- Ubuntu Linux (14%)
- z/OS or other mainframe (12%)
- Oracle Enterprise Linux (11%)
A whopping 80% of the 244 Sun Solaris users surveyed said the Oracle acquisition would not affect their use of the Solaris operating system -- and that they intend to stick with it.
That indicates that the loyalty of many Sun shops to the Solaris operating system and Sparc chips continues relatively unabated after Oracle's buyout of Sun Microsystems.
A senior systems admin at a large utility company in the Southwest echoed this notion. His company's data centers will keep running Solaris which is, in his words, "the most advanced operating system in the world."
The albatross of migration may also contribute to this stance. "I would not want to take on a migration if I didn't have to," said Pete Sclafani, the CIO of San Jose, Calif.-based 6Connect, Inc. "The biggest enemy is the daunting task of migrating to something else." Sclafani also noted that despite all the anxiety about the future of Sun's technology, Sun still makes really great hardware.
The utility company's systems admin said Solaris remains the strongest platform outside the mainframe world for databases that do the heavy lifting of most businesses. He also lauded Sun's virtualization technology -- Domains, Zones, containers and logical domains, or LDOMs -- all of which have been blessed by Oracle.
The data center construction boom busts?
According to respondents, less than 20% of data centers will run into capacity constraints over the next 12 to18 months. Compare that to November 2007, when nearly 80% of SearchDataCenter.com's audience said they were involved in a data center construction or renovation project.
The majority of data centers that have run out of power and cooling are making do with what they have. Among 200 data center managers, respondents have chosen the following approaches to capacity constraints:
- Consolidating existing data center -(51%)
- Building a new data center (32%)
- Putting workloads in the cloud (28%)
- Leasing a colocation facility (24%).
Since the economic downturn, prioritizing energy efficiency has declined significantly. Half of data center managers said that reducing data center energy was "very important" in 2009, versus 34% in 2010. For 20%, reducing energy consumption isn't a priority at all, compared with 14% last year.
Compared with 2009, IT managers' tactics to improve efficiency stayed the same in 2010. Forty-five percent of shops adopted hot- or cold-aisle containment, 19% tried liquid cooling, 41% tried power-down features on servers, 27% use DC-power, 80% say they're buying more energy efficient servers, 83% say that server virtualization will save money on the electric bill, 77% are improving air conditioner efficiency, and 20% are trying economizers.
Server virtualization deployments increase; Hyper-V use does not
In 2010, nearly 60% of data centers will expand their virtualization deployments, and nearly one-quarter of respondents (22%) run VMs on 50% to 100% of their server hardware. Many adopters use virtualization for disaster recovery, dynamic allocation of resources and desktop virtualization.
The top two vendors for virtualization-ready servers are HP and Dell -- companies that focus on the commodity server market. IBM was a distant third, with other vendors in single digits. Large rack servers (those with 8 to 14 cores) are the platform of choice for server virtualization; nearly 30% of respondents said they will standardize virtual machine deployment on this form factor.
Despite the release of Hyper-V R2 in late 2009, adoption of Microsoft's Windows Server virtualization software remains in the single digits. But when we asked users about virtualization purchasing plans for 2011, 19% said they would deploy Microsoft Hyper-V R2.
Hyper-V's relatively low adoption rate thus far doesn't surprise Rojoli Technologies' Ganote, and as the survey results indicate, he expects adoption to increae dramatically.
"VMware had what, a four- or five-year head start?" Ganote said. Particularly in larger environments, VMware implementation has ruled the day, and these shops won't switch anytime soon. But Ganote expects Hyper-V to fare well in the coming year, citing the stability and rich feature set in Hyper-V R2, including dynamic memory allocation included in SP1. "The product's maturing; it's getting better and better, and people are going to start migrating to it."
Among 549 respondents, the following are IT shops' primary virtualization technology:
- VMware vSphere (35%)
- VMware ESX 3.5 (26%)
- VMware Server (8%)
- Microsoft Hyper-V R2( 6%)
- Citrix XenServer (4%)
- Microsoft Hyper-V (4%)
- VMware ESX prior to 3.5 (3%)
- Microsoft Virtual Server (2%)
- VMware 3i (2%)
- IBM-AIX virtualization (2%)
- Mainframe partitions (2%)
- Oracle VM (2%)
- Red Hat Enterprise Linux-based KVM (2%)
The drivers for increasing virtualization budgets are primarily based on a quick ROI: saving on hardware costs, saving on power and cooling costs and reducing data center floor space.
Cloud computing adoption statistics
Respondents interest in cloud computing remains tepid, and for those shops with interest, it is largely in private cloud computing architecture.
Among 1,023 respondents, 69% will not consider cloud. Over the next 12 months, only 10% will implement private cloud, and 6% will use public cloud computing. A mere 7% have implemented private cloud computing and only 3% have implemented public cloud.
For companies that haven't considered using cloud computing, the No. 1 concern is security (38%). Other barriers to adoption include applications that don't translate to a cloud architecture, no chargeback or metering structure in place in the companies, and compliance issues.
"The mainstream reaction to cloud is fear of security and regulation concerns," said Michael Coté, an analyst at the Seattle, Wash.-based consulting firm RedMonk. For many, these fears are real, as their lawyers tell them that regulations require them to "own" various computational resources. "Public cloud proponents need to help sort this out in the same way online retailers had to make consumers comfortable using their credit cards online in the 90s," Coté said.
For the IT pros considering cloud, the primary reason is a desire to reduce infrastructure costs, followed by cost flexibility over traditional hosting/colocation providers. IT managers also want more scalable infrastructure and less in-house IT staffing costs.
When asked which applications they would put in the cloud, 58% said test and development, 53% said application hosting, 45% said email, 35% said disaster recovery, 29% said business intelligence.
Systems management spending on the rise
In 2010, respondents increased spending on systems management tools, with 27% saying reporting an increase in spending, compared with 9% last year. Automation continues to drive spending, with more than half of 370 respondents saying that automating manual processes is the No. 1 driver for their purchases, followed by increasing staff productivity and tracking application performance problems. Virtualization and configuration challenges have also driven systems management spending.
"In 2009 the most common way that CIOs were planning to deal with shrinking budgets and staff was via investments in enterprise management solutions," said Julie Craig, an analyst at Boulder, Colo.-based Enterprise Management Associates. So it's no surprise that tools investments are up in 2010. "I am finding that many of the vendors I deal with have reported revenue growth throughout the downturn -- with some reporting significant growth."
Top spending areas include performance management software, virtualization management and capacity management tools.
As for using Software as a Service, or SaaS-based systems management tools, 63% of 1,023 respondents aren't interested. But 26% considered replacing in-house tools with Systems Management as a Service, and 11% already use SaaS-based IT systems management tools.
About the survey
Conducted by email between April to June 2010, the Data Center Decisions survey includes 1,049 respondents: 365 IT administrators, 312 IT directors, 188 consultants, 86 IT executives, 60 data center facility managers. More than 90% of the participants are U.S.-based and represent a wide range of company size and business verticals.
Alex Barrett, Lauren Horwitz and Barbara Darrow contributed to this report.
Matt Stansberry is Executive Editor of SearchDataCenter.com. Let us know what you think about the data center purchasing survey; email Matt Stansberry.