IDC: Cloud infrastructure spending continues double-digit growth rate

Vendor revenue from sales of infrastructure products (server, enterprise storage, and Ethernet switch) for cloud IT, including public and private cloud, grew 48.4% year over year in the second quarter of 2018 (2Q18), reaching $15.4 billion, according to IDC's Worldwide Quarterly Cloud IT Infrastructure Tracker.

IDC also raised its forecast for total spending (vendor recognized revenue plus channel revenue) on cloud IT infrastructure in 2018 to $62.2 billion with year-over-year growth of 31.1%.

"As share of cloud environments in the overall spending on IT infrastructure continues to climb and approaches 50%, it is evident that cloud, which once used to be an emerging sector of the IT infrastructure industry, is now the norm. One of the tasks for enterprises now is not only to decide on what cloud resources to use but, actually, how to manage multiple cloud resources," said Natalya Yezhkova, research director, IT Infrastructure and Platforms. "End users' ability to utilize multi-cloud resources is an important driver of further proliferation for both public and private cloud environments."


Some highlights:

• Quarterly spending on public cloud IT infrastructure has more than doubled in the past three years to $10.9 billion in 2Q18, growing 58.9% year over year.
• By end of the year, public cloud will account for the majority, 68.2%, of the expected annual cloud IT infrastructure spending, growing at an annual rate of 36.9%.
• In 2Q18, spending on private cloud infrastructure reached $4.6 billion, an annual increase of 28.2%. IDC estimates that for the full year 2018, private cloud will represent 14.8% of total IT infrastructure spending, growing 20.3% year over year.
• The combined public and private cloud revenues accounted for 48.5% of the total worldwide IT infrastructure spending in 2Q18, up from 43.5% a year ago and will account for 46.6% of the total worldwide IT infrastructure spending for the full year. 
• Spending in all technology segments in cloud IT environments is forecast to grow by double digits in 2018. Compute platforms will be the fastest growing at 46.6%, while spending on Ethernet switches and storage platforms will grow 18.0% and 19.2% year over year in 2018, respectively. Investments in all three technologies will increase across all cloud deployment models – public cloud, private cloud off-premises, and private cloud on-premises.
• The traditional (non-cloud) IT infrastructure segment grew 21.1% from a year ago, a rate of growth comparable to 1Q18 and exceptional for this market segment, which is expected to decline in the coming years. At $16.4 billion in 2Q18 it still accounted for the majority, 51.5%, of total worldwide IT infrastructure spending. For the full year, worldwide spending on traditional non-cloud IT infrastructure is expected to grow by 10.3% as the market goes through a technology refresh cycle, which will wind down by 2019. By 2022, we expect that traditional non-cloud IT infrastructure will only represent 44.0% of total worldwide IT infrastructure spending (down from 51.5% in 2018). This share loss and the growing share of cloud environments in overall spending on IT infrastructure is common across all regions.
• All regions grew their cloud IT Infrastructure revenue by double digits in 2Q18. Asia/Pacific (excluding Japan) (APeJ) grew revenue the fastest, by 78.5% year over year. Within APeJ, China's cloud IT revenue almost doubled year over year, growing at 96.4%, while the rest of Asia/Pacific (excluding Japan and China) grew 50.4%. Other regions among the fastest growing in 2Q18 included Latin America (47.4%), USA (44.9%), and Japan (35.8%).

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California enacts Net Neutrality law, Washington moves to block

California governor Jerry Brown signed into law the Internet Consumer Protection and Net Neutrality Act of 2018 (Senate Bill 822), which prohibits fixed and mobile Internet service providers from blocking lawful content, applications, services, or nonharmful devices, impairing or degrading lawful Internet traffic on the basis of Internet content, application, or service, or use of a nonharmful device, and specified practices relating to zero-rating.

The new law also prohibits fixed and mobile Internet service providers from offering or providing services other than broadband Internet access service that are delivered over the same last-mile connection as the broadband Internet access service, "if those services have the purpose or effect of evading the above-described prohibitions or negatively affect the performance of broadband Internet access service."

The U.S. Department of Justice immediately announced a lawsuit against the state of California regarding Senate Bill 822.

FCC Chairman Ajit Pai issued the following statement: “I’m pleased the Department of Justice has filed this suit.  The Internet is inherently an interstate information service.  As such, only the federal government can set policy in this area.  And the U.S. Court of Appeals for the Eighth Circuit recently reaffirmed that state regulation of information services is preempted by federal law.   Not only is California’s Internet regulation law illegal, it also hurts consumers.  The law prohibits many free-data plans, which allow consumers to stream video, music, and the like exempt from any data limits.  They have proven enormously popular in the marketplace, especially among lower-income Americans.  But notwithstanding the consumer benefits, this state law bans them.  The Internet is free and open today, and it will continue to be under the light-touch protections of the FCC’s Restoring Internet Freedom Order.  I look forward to working with my colleagues and the Department of Justice to ensure the Internet remains ‘unfettered by Federal or State regulation,’ as federal law requires, and the domain of engineers, entrepreneurs, and technologists, not lawyers and bureaucrats.”

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SSE teams with Three UK and O2 for fibre through London sewers

SSE Enterprise Telecoms, which operates a 13,700km private telecoms network and an estate of 15 data centres across the UK,  announced a fibre agreement with Three UK and O2 that will form the basis of enhanced fibre access in the country’s capital.

The companies will intend to deploy fibre through the sewers of London to enhance backhaul capabilities of 4G and 5G networks.

Under the agreement with Three UK and O2, approximately 100 points of connectivity exit from this central London sewer network via two BT Exchanges. By partnering with SSE Enterprise Telecoms, Three UK and O2 can operate their own Central London Area (CLA) network, while also accessing spare fibre ducts for future initiatives in London.

“Networks will fundamentally underpin the UK’s digital economy and will be essential to 5G services,” said Colin Sempill, Managing Director of SSE Enterprise Telecoms. “With this high capacity core in the London sewers, Three UK and O2 are tapping into our unique, diverse connectivity and putting their networks in a strong position to trial 5G offerings, while enhancing existing services for their customers.”

Dave Dyson, Chief Executive Officer of Three UK added, “New and innovative models are essential to improving the customer experience of mobile networks by increasing the availability of dark fibre for mobile backhaul and driving competition in the market. Our partnership with SSE Enterprise Telecoms and O2 is one of the first examples of using existing infrastructure to improve connectivity in an urban area.”

Brendan O’Reilly, Chief Technology Officer of O2 shared: “This kind of agreement is essential to allow for continued investment and improvement of services for our customers. This partnership is a great example of SSE Enterprise Telecoms, Three UK and O2 coming together in a collaborative and innovative way to address the growing challenge and pressure of obtaining access to fibre for mobile backhaul in the UK”

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South Atlantic Cable System ready for service with Angola-Brazil

The South Atlantic Cable System (SACS), which is a 40 Tbps, 6,165 km cable linking Angola to Brazil, is now on-stream and open for commercial traffic.

SACS features four fibre pairs, with each fibre pair capable of transmitting 100 wavelengths at 100 Gbps. NEC served as lead contractor on the project.

The SACS cable system lands at Sangano cable landing station in Angola, near the capital city of Luanda, and will provide onward connectivity to the Angonap data center. In Brazil, SACS lands directly in a newly constructed data center, which was built together with SACS and for another cable system connecting Brazil to the U.S.A.

SACS is 100% owned by Angola Cables.

SACS was partially f

unded by the Japan Bank for International Cooperation (JBIC) through a loan agreement in buyer's credit with Banco de Desenvolvimento de Angola (BDA), the state-owned development bank of Angola. The loan was co-financed with Sumitomo Mitsui Banking Corporation (SMBC) with Nippon Export and Investment Insurance (NEXI) providing insurance for the portion financed by SMBC.

"Our ambition is to transport South American and Asian data packets via our African hub using SACS, and together with Monet and the WACS, provide a more efficient direct connectivity option between North, Central and South America onto Africa, Europe and Asia. By developing and connecting ecosystems that allow for local IP traffic to be exchanged locally and regionally, the efficiency of networks that are serving the Southern Hemisphere can be vastly improved. As these developments progress they will have considerable impact for the future growth and configuration of the global internet," said Mr. Antonio Nunes, Chief Executive Officer of Angola Cables.

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Facebook open sources LogDevice data store

Facebook is committing to the open source community its LogDevice distributed data store for sequential data.

LogDevice was originally developed and currently deployed within Facebook for a variety of workloads, including event streaming, replication pipelines, transaction logs, and deferred work journals. LogDevice comes with a command-line administration tool called LDShell.

https://code.fb.com/core-data/open-sourcing-logdevice-a-distributed-data-store-for-sequential-data/

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Gremlin adds $18m in funding for its Failure-as-a-service

Gremlin, a start-up based in San Francisco, announced $18 million in Series B for its Failure-as-a-Service platform.

Gremlin, which was founded by a former engineer at Amazon and Netflix, said it helps customers build more resilient system through a new engineering philosophy called chaos engineering. The new tool simulates how a system would react when encountering challenges, such as network latency, data center outages, etc. With nearly a dozen attacks and more launching soon, Gremlin recreates the most common failures across three categories: Resource, Network, and State. The Gremlin tool is delivered as a subscription-based service, with pricing based on per instance or service.

The new funding round was led by Redpoint Ventures.

“The concept of purposefully injecting harm into systems is still new for many companies, but chaos engineering has been practiced at places like Amazon and Netflix for over a decade,” said Kolton Andrus, CEO and Co-Founder of Gremlin. “We like to use the analogy of a flu shot, injecting small amounts of harm to build an immunity, in order to proactively avoid disasters. Now with ALFI, users will be able to bring this practice to serverless environments, and have much greater control within their applications.”

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Zayo to supply high-bandwidth IP to Mexican carrier

Zayo announced a contract to provide a high-bandwidth IP solution to a leading Mexican carrier. The solution will facilitate interconnection to U.S.-based content, gaming and webscale companies via Zayo’s data center at 1950 N. Stemmons in Dallas.

Zayo operates a Tier 1 IP backbone delivering IP solutions in North American and European data centers and Internet exchange points.

“We continue to see growing demand from global carriers for interconnection, and we are leveraging our international experience to make inroads in strategic markets,” said Randy Dunbar, president of Transport at Zayo. “This transaction is a success story of flexibility and agility, underscoring our commitment to global customers. In addition to this IP solution, we are providing the platform for this carrier to connect to major markets that Zayo serves.”

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Molex to acquire Laird Connected Vehicle Solutions Division

Molex agreed to acquire the Connected Vehicle Solutions division of Laird Limited. Financial terms were not disclosed.

Laird CVS specializes in the design, development and delivery of vehicle antenna systems, smart device integration and vehicle connectivity devices.

Molex said the acquired solutions will add to its agile connected vehicle technology ecosystem, which feature a 10Gbps Ethernet backbone for automotive OEMs building next-generation, intelligent vehicles.

“There is tremendous demand for seamless end-to-end network integration across hardware, software and services in the automotive industry,” said Tim Ruff, senior vice president, Molex Business Development. “Laird CVS expands our geographic reach and strengthens our ability to support automotive OEMs seeking to introduce future-ready vehicles with critical functionality while still containing costs. It aligns with our strategy to provide groundbreaking solutions for a growth market.”

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