Monday, June 24, 2024

Survey: Asia data center market behavior is changing

Tech firm Emerson Network Power has flagged an important change in the dynamics of the Asian data center market following the results of its 9th bi-annual Market Pulse Survey.

According to Gene Hayden, VP of sales for Emerson Network Power in Asia, the results of the survey suggested that data center investment cycles are contracting, which fundamentally changes the approach that data center professionals must follow when considering short- and longer-term infrastructure deployments.

?Long-term crest and troughs have been replaced with shorter terms hikes and spikes,? said Hayden.

?This translates to shorter project cycles, and necessitates revised user expectations when reviewing infrastructure capacity. Other trends, like the explosion in mobile devices and the increased pervasiveness of the cloud, also point to a change in pace in decision-making; companies can?t simply stop investing because the market is slowing, because chances are the market will swing sharply in the short-term and they?ll be left behind.?

The summary results from all nine Market Pulse surveys indicate most of the gains from the previous survey (March 2012) have retreated, with the important exception of project schedules.

Ross Hammond, director telecom business at Emerson Network Power in Australia and New Zealand, said there is a generally positive view of the market in the short term, particularly among the Design and Construct (D&C) segment which traditionally has been the most indicative of future market trending.

?If I read the index the same way I did two or three years ago I?d be less optimistic than I am now,? said Hammond.

?What we?re seeing points very strongly to the need for fluidity in infrastructure. Yes there will be rapid contractions just as often as escalations in demand, but companies can?t just stop investing. If they do, they risk losing their competitive advantage. Likewise vendors that can?t match this fluidity in the solutions they offer will fall behind.?

There is other evidence in the market, outside the Market Pulse survey, that corroborates these results.

Last month, McKinsey & Company published its Economics Conditions Snapshot report, noting ?the latest results indicate?executives broadly believe that demand for their companies? products or services ? as well as their companies? profits ? will increase in the next six months, despite their concern about sluggish global and domestic demand.?


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