“A part of their (hyperscalers’) slowdown has to do with the overall economy. But part of it is businesses realising that while hyperscalers are inexpensive during the initial development phase, they are very expensive during the production phase or when (customers’) applications get used at scale,” Giancario, told ET during his visit to Bengaluru last week. “So that repatriation is happening as they are realising that some of it (cloud storage) they are better off running themselves (on-premises) or using a hybrid environment makes more sense economically.”
The data storage can happen in three ways – private or on-premises model, public model, where the customer opts the services of hyperscalers and hybrid model, which is a mix of on-premises cloud and public cloud services.
Banking, financial services and insurance, telecommunications and software-as-a-service (SaaS) are the top sectors “repatriating” to on-premises or hybrid cloud storage as they feel these models are more economical when they scale up to “millions” of customers.
According to market research firm ISG, the infrastructure as a service (IaaS) that hyperscalers reported 8% revenue growth for the year ended 2022 – its lowest annual growth ever. The top three hyperscalers reported only 6% growth in terms of annual contract value for the December-ended quarter.
The NYSE-listed firm also said it is open to working with partners such as Flextronics, Celestica and Foxconn if they open a manufacturing unit in India but the company will not set up a unit themselves as it relies completely on third parties. The company has a research and development (R&D) centre in Bengaluru opened last year and it employs 200 engineers currently.
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The company also said environmental, societal and government (ESG) norms will help the company in terms of sales as flash storage, which the company specialises in, uses only a tenth of physical space and power compared to disk storage.
