We are quickly coming up to the end of 2015. This is the time when we analysts like to make predictions about what is in store for us in the upcoming year. Let me start with one of the biggest surprises of 2015, the Dell acquisition of EMC. This acquisition is expected to close sometime in mid-2016, and I want to see the deal close before I shed my skepticism over its likelihood of coming to completion. I understand that it is pretty much a done deal, but nothing is truly finished until the final signature is added. Keeping up with the status of this acquisition is one of the things at the top of my list for 2016.
The next big company worth keeping eye on is Microsoft. Microsoft is making leaps and bounds in the public cloud space and at the same time dramatically increasing its portfolio of cloud services offerings. Office 365 has dramatically increased its footprint and presence in the corporate, education, and consumer spaces. Office 365 is just one aspect of the amazing continued growth of Microsoft Azure. Maybe 2016 will be the year when Azure closes the gap with Amazon AWS and positions itself to be the new king of the hill of the public cloud.
In 2016, we are likely to see an increasing number of companies, large and small, adopting a hybrid or more-hybrid approach in their data centers. Microsoft, in my opinion, has been the greatest driver of hybrid solutions in the corporate world. Whether or not this was Microsoft’s initial master plan, Azure has gotten the majority of its new business from its Software as a Service side, namely Office 365. I believe this trend will continue, accelerating even more in 2016. Microsoft has helped to establish, define the path, and develop the menu for IT services à la carte. I believe the corporate world will continue to embrace this type of service model and expect that other services outside of Office 365 will continue to grow and expand.
If my prediction for the rise of à la carte IT services is correct, then 2016 is going to mark the start of a death march for managed services as we know them today. Ok, maybe “death march” is a bit of an exaggeration. However, this side of the industry is facing an identity crisis in that the definition of managed services and what it encompasses will be changing and evolving in 2016 and beyond. Let’s use Microsoft Office 365 as an example. What would you call it? How would you define what exactly Microsoft Office 365 is? Yes, it is basically Software as a Service, but it is also a managed service. I foresee a future in which no single company provides all the managed services for a business; rather, many different companies will provide the managed services for a specific solution.
Managed services providers will also have to contend with the continued growth and availability of automation inside the data center. As companies automate more and more day-to-day operation tasks, the responsibilities of managed services teams will shrink in relation to the number of tasks that become automated. In other words, automation has the potential to greatly reduce the head count and costs of any on-site managed services providers. I do not agree with the idea that automation will completely replace all of the people; rather, it will greatly reduce staffing needs. The Tier 1 and Tier 2 support levels are what automation is likely to affect the most.
In closing, I’d like to mention one other company that has my attention and on which I will be keeping an eye throughout 2016 and beyond. That company is Primary Data. Primary Data is brought to you by the same great minds that established and developed Fusion-IO. With the intelligence and automation that it is incorporating into its product, Primary Data is a prime example of how products and services in 2016 and forward will have intelligent automation baked right into the product out of the box. I had the opportunity to be part of a panel at VMworld’s Tech Field Day Extra during a Primary Data briefing with Lance Smith and David Flynn. I came away pretty impressed by this team. Primary Data is almost sure to have a great 2016 in store.
So, there you have it: my thoughts on 2016! What are yours?
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