What is "hyperscale?" The word itself is a pretty good indicator. The prefix "hyper" means over or excessive. The word scale refers to size or extent. So companies now being called "hyperscalers" are those massive companies like Google, Facebook, and Amazon that are making efforts to not only dominate the public cloud and cloud services industries, but to expand their business into numerous related verticals, as well.
Right now, there are only 24 companies worldwide that match the definition of “hyperscale” according to Synergy Research Group. Those 24 companies account for 68% of the cloud services market. They operate a combined 320 data centers, with that number expected to jump by 100 by the end of 2018. Cloud dominance is really just one part of the vision for these companies. The real goal lies in developing infrastructure that can support hundreds of millions, perhaps even billions, of users.
Let’s take a closer look at what defines hyperscale companies today and what their ambitions and tactics might be tomorrow.
A bold vision. Hyperscale companies have a broad, ambitious vision for their future. In most cases, that vision requires a substantial investment in infrastructure. Microsoft, for example, recently revealed that it has invested nearly $20bn to build the infrastructure necessary to support its Azure cloud. By a similar token, Amazon is the leader in both data centers and ecommerce, yet it is taking steps to own its distribution chain, as well.
A new approach to enterprise storage. Thus far, it’s only the massive players mentioned above that have really put hyperscale compute and storage into practice on a large scale. But for businesses that need to store and process massive amounts of data, hyperscale represents an exciting opportunity moving forward. Industries like banking, oil & gas, and healthcare & pharma all can adopt more effective and nimble data collection strategies thanks to increased redundancy at the server level.
Cloud domination. For the moment, cloud infrastructure and services remain the most in-demand of the services that hyperscalers provide. With larger enterprises ramping up their storage and compute needs and small- and medium-sized businesses taking the plunge for the first time, the race for cloud market share is very much on. While we expect to see the primary hyperscale players expand into and dominate other verticals, we also expect cloud to remain their bread and butter.
Taking on mobile operators? What industry could be next? We’re now also seeing certain situations where traditional communications service providers have to protect their market share against new innovations from hyperscalers like Google and Facebook. With more and more of daily social and economic business conducted on desktop and mobile devices, it’s easy to spot the cause for concern. While currently carriers hold the advantage in that their fiber and additional infrastructure is already in place, we’ve seen the pace at which hyperscale companies like Google adapt to new technologies. We can already see how hyperscalers could disrupt traditional communications providers, but what industry could be next?
As hyperscale computing is still very much in development, this is by no means an exhaustive guide to the concept. But I hope that exploring these few topics has helped paint a picture of what hyperscale is and what the goals of hyperscalers are going forward. What do you think about the future of hyperscale compute and storage? Will the big players begin to disrupt more traditional industries? Will the number of providers dwindle as the big players expand their reach? Share this post on Twitter or LinkedIn and let us know what you think.