Monday, September 22, 2008

Data center outsourcing on the rise in India

Estimates put the third party data center market including co-location services, hosting services and managed services in India at $150 million [2007]. With a projection of an average CAGR of 36% over the next two years, the verticals that outsource the most are BFSI and manufacturing together accounting for about 53% of the market.
Companies in India, like those elsewhere, have to move swiftly to adapt to change, seize new opportunities and meet the demands for increased productivity and reduced costs. Data center outsourcing is the outcome of this requirement.
Before considering the case for outsourcing, we need to understand what drives corporations to outsource their data centers at all, particularly given their fears about data security, reliability and intellectual property. Clients look to data center outsourcing when they face one or more of the several issues like cost pressure, increasing management time and high investments in technology and infrastructure.

Here are the figures for the 2006 and 2012 (projected) popularity of data center outsourcing across various verticals.

Verticals 2006 2012
Financial Services 28% 33%
Telecommunications 9% 11%
Manufacturing 25% 24%
Energy and Utilities 4% 3%
Healthcare 4% 5%
Media and Entertainment 1% 2%

----------Source: Datamonitor

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