Study Predicts Strong SMB Data Center Spending In 2014, But VARs Say It Could Skyrocket


Worldwide spending on data center services by small and medium businesses is expected to grow by 18.39 percent in the coming year, according to a study released Friday by analyst firm Research and Markets.

However, solution providers and distributors say that figure is much less than what they're seeing, as a growing number of SMBs are opting to offload time-consuming data center management tasks to third party service providers.

Research and Markets said it based its18.39 percent growth prediction on the rapidly growing demand for infrastructure and facilities. Autotask CEO Mark Cattini told CRN he thinks Research and Markets' prediction isn't accurate given the rapid expansion of SMB cloud opportunities.

[Related: Autotask CEO: With Consumerization Over, SMBs Stand To Be Fastest IT Growth Area]

"To be honest, I'm surprised the growth numbers were as low as they were," Cattini said in response to the survey numbers. "Nobody wants to own anything anymore. [That's] the whole managed services concept."

Cattini thinks 50 percent growth next year would be a more accurate figure. He expects the growth to really take off in the next three to five years, as physical servers reach their end-of-life and organizations choose to replace them with cloud-based alternatives.

Companies such as Google have already invested big bucks in data center infrastructure. Google invested a record $1.6 billion in data centers during its fiscal second quarter, the company said in its Q2 earnings report.

The spending shift from on-premise to cloud-based infrastructure will stem from practical decisions based on cost and growth scalability, Patrick Burns, vice president of product management at Autotask, told CRN.

"It used to be a religious debate: cloud versus on-premise. [But] it's not that anymore. It’s a practical discussion," Burns said.

Growth in data center spending represents a huge opportunity for the channel, particularly managed service providers. Jason Bystrak, director of cloud and managed services at Ingram Micro, said this is a great opportunity for MSPs to grow revenues and move more clients to the cloud.

"As more of the end users IT departments go to the cloud, in order for those MSPs to be relevant they need to manage those solutions," Bystrak said.