Hyper-Converged Infrastructure Market Drawing More Interests Globally

Jul 19, 2019

HCI (Hyper-Converged Infrastructure) market is becoming more popular as it recorded three-digit growth in just a year within South Korean market. It has established a new market based on convenient management and cloud interface.
Nutanix, Dell Technologies, Hyosung Information (Hitachi Vantara), HPE (Hewlett Packard Enterprise), and NetApp that pioneered HCI market are going after the market based on their expertise.
There are high expectations on growth of HCI market in the future as businesses that are preparing for SDDC (Software Defined Data Center) are purchasing bulk of equipment.
◊Why is HCI market so popular?
HCI market was worth $59.8 million (70.2 billion KRW) in 2018 after it grew by 106.2% compared to 2017. Speed of its growth was even faster during the first quarter. It grew by 118.6% in the first quarter compared to the first quarter of 2018.
Dell Technologies, HPE, and Hitachi Vantara that had observed the early stage of HCI market saw stable products and maturity of the market and decided to jump into the market on full-scale.
HCI manages individual area such as virtualization, computing, storage, and network from single system through software (SW). It can also be combined with private and public cloud services based on virtual infrastructure. Because single device can manage server, storage, and network, HCI can help lessen amount of burdens for administrators and it can be flexible with changes of tasks.
Growth of HCI market was based on verification of products for the past ten years and unprecedented fast changes shown by IT market. According to VMware’s survey, it is expected that there will be more applications that will be used for the next five years than the number of applications that were used in the past 40 years.
Meanwhile, response by HW infrastructure is slow compared to how quickly markets are changing. Although large corporations ask for immediate expansion of infrastructures to their IT departments depending on changes within markets, lengthy time and high cost are needed as current HW infrastructure system needs to set up a new server, new storage, and new network separately.
“Because traditional businesses are standardized, experienced person in charge of infrastructures focuses on optimization once infrastructures are established.” said a representative for the industry. “Due to recent development of various applications, large corporations request for flexibility.”
HCI market is verified as well. Initially, businesses established HCIs for limited use such as separation of network and testing of developments. However, there are now examples of using enterprise applications such as ERP (Enterprise Resource Planning) and database (DB) due to verified stability and diversified workload. Some companies also use HCI to respond to traffic increase from distribution and games by setting up a private cloud through hyper-converged system.
“HCI supplier does the work and provides time needed to establish current HW for companies.” said Director Jung Sang-hyeop of Dell EMC. “Companies can utilize HCI solutions depending on their needs by entering necessary items into HCI solutions which then turn into SD (Software Defined) computer, SD storage, and SD network.”

Hyper-Converged Infrastructure Market Drawing More Interests Globally

◊Various foreign businesses pioneer HCI market
HCI market was initially pioneered by Nutanix. Nutanix targeted global markets based on its phrase ‘invisible infrastructure’, which claimed to support simple administrative control, in 2009. It has quickly owned market shares in South Korean market as well by allowing companies to select its virtual solution as well as various SW such as VMware. It has supplied its SW solution was provided to Dell EMC, LENOVO, and HPE and it has shown possibility of expansion of HCI market.
Dell Technologies is targeting HCI market based on VxRail. It is looking to solidify its position as the top HCI business through Dell EMC server, storage, and network competitiveness as well as solutions from its subsidiary VMware. Because it works the closest with VMware, which is the top HCI SW solution provider, it is looking for optimization.
“Our HCI products are divided into products that support various hypervisors and they satisfy requests from various enterprise computing environments.” said a representative for Dell Technologies. “In South Korean market, we have the sole right to distribute VMware’s products and we are targeting South Korean market after setting up a joint business group with VMware.”
Hyosung Information launched its products in 2017 centered on Hitachi Vantara’s ‘UCP HC’ and it started to target South Korean market on full-scale starting from 2018. Its change is the most noticeable out of major venders. Although it recorded only 6% of market shares in the first quarter of 2018, it jumped to the top of South Korea’s HCI market by recording 23% of market shares in the first quarter of 2019. It has secured its market shares based on its stable products from high-end storage field and South Korean HCI team. It believes that HCI will be the groundwork for changing next-generation datacenters and it is going to provide a roadmap in the future for changing datacenters.
“We manage a team that is comprised of storage, server, network, and virtual engineers and engineers specializing in public and private cloud.” said a representative for Hyosung Information. “To implement an infrastructure environment optimized for workload, our engineers provide support from set-up to maintenance.”
HPE has been expanding its influence within HCI market after acquiring SimpliVity in 2017 and joining hands with VMware and Nutanix. Its strength is its ability to provide high availability functions such as real-time duplication removal through FPGA (Field Programmable Gate Array) and backup and disaster recovery from single platform. It succeeded in securing Shinhan Bank, NEPES, and DSME as its customers.
NetApp also jumped into HCI market. Although its market shares are not huge, it is working on securing market shares based on its ability to tie current storage and cloud.
◊South Korean businesses lacking interests in HCI market
While global businesses are increasing their investments into HCI market and are joining hands, it is hard to find South Korean businesses making noticeable movement within HCI industry. Although some SW businesses are showing interests in HCI market, HW businesses are still focused on server and storage. HCI Development Project pushed by South Korean Government early this year was changed into a voluntary participation due to lack of participants. HCI is a technology that is absolutely needed to tie next-generation datacenters and cloud. However, South Korean businesses are only focused on server and storage rather than future investments.
“We know that HCI technology development project only had one participant and was cancelled.” said a representative for a business that participated in HCI Development Project. “The project was changed into smaller parts such as server and storage.”
Staff Reporter Jung, Youngil | jung01@etnews.com

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