Telecom operators set to expand data center offerings to increase revenue

By Telecom Lead Team: The average numbers of medium,
large, and super size data centers owned by service providers that offer data
center and cloud services is set to grow over the next 2 years, with large and
super sized data centers growing the most.

Virtualization and network convergence allows these
operators to grow sustainably to meet the demand for cloud services.

The top 2 data center application strategies planned by
respondents are 1) running applications on a fully virtualized infrastructure,
and 2) replicating applications and data across data centers based on demand,
such as is common with airline reservations systems.

The #1 data center interconnection strategy planned by
service provider respondents is using multiple physically separate connections
for physical protection.

Use of legacy data center
interconnection (DCI) technologies, leased dark fiber, and SONET/SDH is slowing
over the next 2 years, while wavelength, IP/MPLS, and Ethernet transport are

Service providers are once again in expansion mode, but
unlike in the late 1990s when the bandwidth rush was on, the focus this
go-around is a quest for revenue. Service providers seeking to bolster their
financial picture and gain a piece of the cloud service revenue pie are
leveraging a captive customer base and expanding data center offerings to
include virtualization technologies and even new networking facilities like
Fibre Channel over Ethernet,” said Sam Barnett, directing analyst for data
center and cloud at Infonetics Research.

Infonetics Research announced that global revenue for data center network
equipment is up 12 percent sequentially in Q3 2011, with all segments posting
growth, including general purpose, purpose-built and blade data center Ethernet
switches, application delivery controllers (ADCs) and WAN optimization

The data center network equipment market is also up 12
percent year-over-year (from Q3 2010).

The North American data center equipment market had the
strongest regional performance in Q3 2011 (up 16 percent sequentially).

Asia’s sequential growth slowed significantly but remains
up an astounding 39 percent year-over-year; and Europe’s Q3 2011 results are in
positive territory (following a dismal second quarter) despite continued
economic concerns.

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