In the past few years, networking has done more to define the modern data center than any other facet of IT infrastructure; however, advances in the technology tend to oscillate between out-of-the blue innovations that catalyze new data center and application designs and evolutionary product enhancements compelled by changes elsewhere in the infrastructure stack. The industry has gone through several such swings between proactive and reactive change, but is currently in the midst of responding to macro trends changing the role of IT, the use of external suppliers, notably cloud services, and new system architectures. These are fueled by several factors:
- The rise of hyperscale cloud providers with burgeoning XaaS portfolios that are displacing many services traditionally provided in-house.
- The spin-off of cloud-developed or -enhanced technologies like containerization, big data systems and deep learning software.
- An explosion in the quantity of relevant business data and corresponding new analytic tools for analyzing petabyte scale repositories.
- The digitization of business and the consequent need for rapid development and delivery of new applications and services.
- The expansion of the data center edge to accommodate new applications driven by arrival of 5G and IoT (Internet of Things) that benefit from lower latency and distributed resources
- Continued financial scrutiny by senior management that necessitates tight control over all expenses not directly contributing to revenue or customer retention.
- The weaponization of security vulnerabilities by sophisticated actors including national intelligence services, criminal syndicates and cyber activists leading to the most challenging, dangerous cybersecurity environment of the Internet era.
Changing Role of IT with Ramifications on Network Operations
Although we’re a decade removed from the depths of the great recession, with corporate profits hitting records every quarter, much like children of the Great Depression, business executives that lived through what were often near-death experiences learned painful lessons that they won’t soon forget. One is a variant on the proverb, “waste not, want not.” Regardless of how fast revenues might increase, business executives realize that they can’t ever afford to get sloppy, particularly as newer disruptive competitors, whether its Amazon in retail, Airbnb in hospitality, or Rocket Loans in home lending, are waiting to snag customers using efficient new business models. According to a recent report from a Wall Street analyst, the aggregate operating margins (a measure of business efficiency) for the S&P 500 have never been higher and in the IT industry now stand at an astounding 20%, almost triple their level of 20 years ago.