Cisco Cloud Index: Be Afraid, Be Very Afraid!

It’s baaaack. The latest Cisco Global Cloud Index is now out, and while it is very similar to previous reports, there are a number of new insights, including higher traffic growth for the datacenter, said Thomas Barnett, Director of Thought Leadership, . He wouldn’t say the overall growth for the datacenter was a surprise, at 25% compound annual growth rate (2014-1019), but last year it was a mere 23%, he noted. “Datacenter traffic is tripling, but traffic is quadrupling, growing at a 33% CAGR.”

Key findings of the study, which tracks global data center and cloud-based traffic growth and trends, include:

-annual global data center IP traffic is projected to reach 10.4 ZB (zettabytes) by the end of 2019, up from 3.4 ZB per year in 2014;

-cloud traffic is projected to quadruple, reaching 8.6 ZB (719 EB per month) by the end of 2019, up from 2.1 ZB per year (176 EB per month) in 2014, and is expected to account for 83%of total data center traffic by 2019;

-cloud IP traffic is expected to reach 8.6 ZB by the end of 2019, up from 2.1 ZB per year in 2014;

-new technologies such as SDN and NFV are expected to streamline data center traffic flows such that the traffic volumes reaching the highest tier (core) of the data center may fall below 10.4 ZB per year and lower data center tiers could carry over 40 ZB of traffic per year;

-North America will have the highest cloud traffic volume (3.6 ZB) by 2019; followed by Asia Pacific (2.3 ZB) and Western Europe (1.5 ZB); and,

-North America will also have the highest data center traffic volume (4.5 ZB) by 2019; followed by Asia Pacific (2.7 ZB) and Western Europe (1.8 ZB).

It appears more work – or at least higher server utilization – is taking place in the cloud, and the spread between datacenter and cloud workloads will only widen, said Barnett. While datacenter workloads will more than double between 2014-2019, cloud workloads will more than triple. The workload density – workloads per physical server– for cloud data centers was 5.1 in 2014 and will grow to 8.4 by 2019; datacenters workload density was 2.0 and will grow to 3.2 over that period.

There is a greater degree of virtualization with cloud, i.e. 90-95% in private cloud. Cisco said it’s a more dynamic space where workloads can be turned on and off.

The race to the cloud is accelerating, according to multiple studies. Over a quarter (28%) of organizations were running mission-critical business applications on cloud IaaS last year, and ‘a significant number of organizations are in the midst of migrating most or all of their infrastructure to cloud IaaS.’

Over half (64%) of SMBs are using cloud-based apps, and up to 88% will use at least one cloud service within the next 2-3 years. The number of midmarket companies that are currently in the process of deploying cloud-based technologies has climbed from 34% last year to 42% in 2015, while enterprises are expected to increase their cloud infrastructure (i.e. server, storage, and Ethernet switch) spending 24% year-over-year to $32.6 billion in 2015, and $53.1 billion by 2019, accounting for 46% of the total spending on enterprise IT infrastructure. The public sector is also embracing a ‘cloud first’ strategy, with federal agency demand for vendor-provided cloud computing services expected to increase from $2.45 billion in FY 2014 to $6.5 billion in 2019 at a CAGR of 21%.

The index is intended to help Cisco and its customers better understand how the cloud is developing, said Barnett. It shows the obstacles and barriers are being overcome.

Another takeaway from the study is the sheer volume of growth taking place, particularly on the consumer side. For instance smartphone traffic is going to exceed the capacity on the phone itself by 2017, which will fuel additional demand for consumer cloud storage, he said.

From a private cloud perspective, Barnett it shows willingness or ability to try new services that can improve productivity or scalability. Public cloud is primarily about extending to extend to more and more people, particularly to underserved markets. “It’s not so much about capacity, but opportunity: how do I deliver a service more efficiently through the cloud.”

The Internet of Things/Everything (IoE/T) will have a huge impact, i.e. 49 times more data than the projected data center traffic for 2019, but it’s still mainly buzz, he said. For service providers, it’s about how do I monetize it. Barnett added that the IoE forecast was relatively conservative, because it’s quite conceivable that total data growth could more than twice as high, especially when you add in sensors and devices without an IP address.

In other company news, Cisco went on a buying binge:

ParStream, a Cologne, Germany-based company – part of the Cisco Entrepreneurs in Residence start up program – that provides an analytics database that allows companies to analyze large amounts of data and store it in near real time anywhere in the network;

Lancope, Inc., of Alpharetta, GA, a provider of network behavior analytics, threat visibility and security intelligence, for $452.5 million; and,

1 Mainstream, Cupertino, CA, which offers a cloud video platform designed to quickly launch live and on-demand over-the-top (OTT) video services to range of connected devices.

Author: Steve Wexler

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