Holland Barry, Senior Vice President and Field CTO, Cyxtera.
While the outlook for the global economy looks a bit sluggish in 2024, the overall trendline for the data center industry looks positive. Why? One reason is generative AI (GenAI). We’ve already seen GenAI drive higher investments in data centers, and expect that trend to gain even more momentum.
In fact, I expect 2024 will cast a bright spotlight on IT infrastructure. Over the past few years, organizations held onto their existing infrastructure a bit longer than normal. Now it’s aging and posing business risk. As they embrace GenAI, businesses will need to upgrade their infrastructure to optimize performance.
This shift will require new technology approaches. Interest in liquid cooling will continue to grow while organizations may recalibrate their costly reliance on the public cloud as they embrace more cost-efficient hybrid solutions. Let’s take a closer look at some of the trends we can expect in 2024:
AI gets real—and will positively impact data center operations
Will AI change the world? Absolutely. It already has. During 2023, organizations did a lot of experimenting, applying AI to different data sets. In 2024, companies are going to become much more intentional about how they use AI to solve very specific business problems.
For example, data center providers will increasingly use AI solutions to improve operational efficiency and sustainability by monitoring and setting optimal thresholds for factors like temperature, humidity and overall general energy consumption. AI tools can also improve the security posture of data center operators and their customers by more proactively alerting them to security events in the data center or warning the data center NOC and/or SOC of issues relating to network congestion or a potential breach.
There is so much potential with AI, but I predict that early experimentation may fall short of expectations (as is often the case). It will take some time to find the diamonds in the rough, and typically, the more specific the use case, the more positive the outcome will be.
In addition to investing in AI, organizations must also invest in upskilling and hiring staff to integrate and run the technology to best accomplish their desired business outcomes. Today the industry is anemic in terms of AI experts. As organizations gain more clarity about how to deploy AI to solve specific business problems, we can expect they will invest in more AI-related training for their teams.
Data center racks will need to pack more power
While we had predicted that data center racks would need more power in 2023, it happened even more quickly than expected due to the rapid rise of GenAI and higher density deployments, as well as more power-hungry general computing (CPUs) coming into the market. And rack density will only go up in 2024. Data center providers will need to leverage advanced cooling technologies and consider new design schemes to keep pace with next-generation technology.
Interest in liquid cooling technologies will rise, but short-term investments will be modest (for now)
It’s no secret that air cooling has its limitations, especially as we look at higher-density deployments. That said, air still meets the cooling needs of many implementations, and while the evolution to liquid cooling is certainly gaining traction, rapid uptake may still be a few years out due to the upfront investment and complexities involved in deploying these solutions in current data center infrastructure.
Today, only the most sophisticated enterprises and service providers are putting these technologies into production. However, interest is skyrocketing, and adoption is both getting easier and more common due to the debut of new solutions and novel approaches. We’ll see definite growth in this category in 2024 but look for a steeper rise down the road once there is more technology standardization and OEM support.
Slow but steady will win the race of cloud recalibration.
In 2023, many organizations experienced the financial pain of having gone “all in” on the public cloud over the previous few years. Now they’re realizing that they may need to make some changes, including migrating certain workloads to a private cloud or back to on-premises.
While we are seeing a move toward cloud recalibration, I don’t think it’s happening at the volume or velocity that we thought it might, given the complexities involved. But we are starting to see big brands make the move, and they’re providing playbooks and measurable cost savings that other organizations can learn from and follow. It’s moved beyond a theoretical game.
While public cloud will continue to grow, adoption will be more selective in 2024 as organizations increasingly embrace hybrid solutions and cloud-like options, like bare metal-as-a-service (BmaaS), that give them the flexibility and scalability of the public cloud with the cost predictability and control of a private offering.
Proximity to data will increase in importance
As it relates specifically to AI, machine learning and high-performance computing, the data in most cases, especially for AI training, wants to live very close to compute. In the past, organizations were just eager to get their project started, so they decided to spin it up in the public cloud and figure it out later—which often led to costly decisions down the road. Now it’s time for some organizations to figure out how to bring workloads back to a private cloud setting or purpose-built AI clouds for performance and cost efficiency gains.
Conclusion
Looking back at my predictions for 2023, one prediction that will certainly carry over into 2024: AI/ML spend and adoption will grow despite macroeconomic headwinds. GenAI presents an enormous opportunity for the data center industry to serve as a broker and catalyst for technological change and innovation breakthroughs. As Forrester Research recently noted, “Dynamic changes are occurring in the technology infrastructure landscape, driven by shifts in business requirements that impact the data center, remote work, edge environments, and connectivity.” This is an exciting time to work in data center operations and I look forward to navigating these changes together.
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