Transformation challenge ahead for services providers

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5 June 2018 | 0

Services providers will be challenged by automation, reliability and scalability, new research suggests.

The first quarterly Voice of the Service Provider survey conducted by US-based 451 Research has revealed that over the next three years, more than three quarters (77%) of services providers will require “some level” of IT transformation to meet the needs of their customers and to remain competitive.

Specifically, 12% of service providers will require complete transformation and almost two thirds (65%) partial transformation, with the remaining quarter or so (23%) requiring no transformation.

When it comes to dealing with the Internet of Things (IoT), the research found that one in five (21%) services providers do not have a formal strategy.

“Over the next two years, 60% of enterprises will run most of their IT in off-premises environments,” research vice president at 451 Research Al Sadowski said. “As such, the vendor community must adapt their product roadmaps, marketing programmes and sales strategies to address the growing role service providers will play.”

Since many enterprises are moving workloads off-premises, services providers are considering hyper-scale for their next compute and storage purchases, which will lead to traditional hardware and software vendors having to compete with the public cloud providers.

In the next 12 months, more than half (57%) of respondents will deploy hyper-converged platforms, up from 38% currently deployed. The survey also revealed that services providers will refrain from using traditional hardware solutions in favour of simpler solutions.

Back-up and disaster recovery are the most represented services even though these are not the fastest-growing IT segments, according to the research firm.

A total of 39% of services providers identified reliability as the most important vendor selection criteria. According to 451 Research, this mirrors the top customer pain point revealed to services providers.

Vendors able to prove their solutions are reliable and of value to their customers are more likely to succeed.

Other findings by the research showed there is strong interest in open networking projects, but limited adoption. Also, Intel and AMD are no longer expected to be the only games in town for servers over the next 12 months as ARM’s cost and flexibility show promise.

For this research, 451 Research spoke to pre-qualified business leaders at infrastructure-based service providers in China, India, the US and the UK.

 

IDG News Service

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