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Big data, the cloud, they all mean bigger IT budgets

Erik Khalitov | iStock / 360 | Getty Images

As the use of big data, cloud computing and virtualization grows, so is the allocation of budgets to data centers among corporates.

Almost half of the respondents in a 2014 Digital Realty survey of data center trends in the Asia-Pacific published in May said they expect their budgets to increase by 5-10 percent over the next 12 months.

"The increase in data center budgets is directly related to the growth in data that organizations are generating as well as the adoption of the analysis of big data and that's really shifted the way companies are looking at data centers," said William Stein, the interim CEO and CFO of Digital Realty, a global provider of data center and co-location solutions.

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"They see data centers as strategic business assets. Data centers now are much more than depositories of data than they were in the past," he added. "Companies are using them to combine data, analyze it and exchange it with their clients and partners and it's a trend that we see accelerating with the migration to the cloud."

According to Cisco, global data center IP (Internet protocol) traffic will nearly triple between 2012 and 2017. It forecasts that overall, data center IP traffic will grow at a compound annual growth rate (CAGR) of 25 percent from 2012 to 2017.

Research firm Gartner says that the use of cloud computing is growing and that growth will increase to become the bulk of new IT spending.

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"Data is nothing unless you refine it. I speak with tons of clients, and every CIO I talk to will tell you that data is going to be the basis of their competitive advantage," IBM's CEO, Virginia Rometty told CNBC last month. "It's not the data alone but the analytics around it."

Kris Kumar, the senior vice president and regional head for Asia-Pacific and Digital Realty, adds: "There's no doubt that IT is changing from a cost center to a revenue-generator for companies and we are starting to see them use big data and virtualization to generate new revenue streams."

"That's a fundamental shift that's occurred in the last couple of years and is likely to accelerate in the next few years," he added.

IDC forecasts that worldwide public IT cloud services spending will reach almost $108 billion by 2017 from an estimate of about $47.4 billion in 2013 as the focus shifts from savings to innovation.

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According to the Digital Realty survey, three main areas are expected to drive the next wave of growth in the capacity of data centers in Asia: the virtualization of critical applications, big data and the consolidation of data centers.

Virtualization, in short, refers to software that makes it possible to run multiple operating systems and applications on one server at the same time.

Of the 245 senior-level decision makers with responsibility for data centers survey in the Asia-Pacific, 47 percent expected this to drive data center growth.

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