Top Reasons the Enterprise Data Center Will Never Die
Despite predictions about its demise, the enterprise data center is alive and well, as strategic on-prem use cases remain and data center tech modernizes.
In 2019, Gartner analyst Dave Cappuccio issued the headline-grabbing prediction that by 2025, 80% of enterprises will have shut down their traditional data centers and moved everything to the cloud.
A lot has gone down since 2019, and Gartner’s latest guidance on the topic comes from John-David Lovelock, vice president analyst,who says, “It’s not as though the data center is going away. The enterprise data center is here to stay. There’s still enough spending by enterprises on servers, licensed software, and the skill sets they need to maintain and operate the environment that currently exists.”
The overall trend toward placing new enterprise workloads in the cloud remains firmly in place, Lovelock says, but it’s not so overwhelming as to cannibalize current levels of enterprise data center deployments. In fact, Gartner says that 2024 global enterprise spending on data centers was a healthy $66 billion.
Synergy Research comes to a similar conclusion. Six years ago, nearly 60% of data center capacity was on-premises; that’s down to 37% in 2024. By 2029, the hyperscalers will account for more than 60% of total data center capacity, while on-premises capacity will sink to only 20%. (Colocation facilities make up the remaining 20%.)