It has been a year that we couldn’t predict. This time last year, DSA made its annual attempt at 5 predictions for 2020 and we missed some big ones. Despite the warning signs, we didn’t see a year of global lockdowns coming and we completely missed the idea that Salesforce might buy Slack.
Last year’s predictions didn’t come to pass, perhaps with the exception of suggesting that AWS will lose its mammoth grip on the public cloud market share. There has been no slide, but dependent on which figures you read, the decline is there, with AWS now down to about 32% of the market – though still growing and the next three biggest players still not surpassing AWS with their combined numbers.
So, what can we predict (or more accurately, take an “educated guess”) will be the big events in data and storage for 2021?
Without further ado, here are the DSA predictions for 2021.
Cloud Data Analytics Market Will Have a Valuation Reset
The valuation falls out of the data analytics market. The market caps for companies like Snowflake and Databricks seem to us humble tech journalists to be significantly overinflated. Neither of these aforementioned companies is achieving close to the annual revenues of Cloudera, yet Snowflake has a significantly higher market cap than Cloudera and Databricks has one on par with them. Perhaps it’s that Cloudera is still closely tied to the days of hype around Hadoop and Big Data. That means the finance world can’t get as excited about them as they seem to be about others that do similar things but started life later, talking “cloud data platform”, which we suspect resonates more with the money men.
Here’s the problem that we see. For all the cloud data players, the platforms on which they rely are also their biggest competitors. All of the largest cloud providers including AWS, GCP, Azure and Ali have machine learning, AI and analytic offerings of their own. The cloud players will take a large chunk of this market. The other problem for these cloud analytics companies is they are all chasing the largest enterprises; They don’t have an offering for “small” – this means they are all chasing the same deals and same customers. The net effect is whilst the companies will survive, the very high valuations will decline. In our opinion, they don’t reflect the market realities.
Qubole Gets Snapped Up
Talking of cloud data analytics, here goes for our first specific prediction for 2021. We feel the large-scale cloud analytics market is a classic case of Get Big or Get Out. With revenues of $50million, we don’t feel that Qubole is big enough to make it. However, they have won some big logos over the years and have a very strong team of Big Data gurus and experts. Why wouldn’t one of the big guys in this space snap them up? We won’t predict who, but any of the companies mentioned in our first prediction could make sense.
Pure Storage Merges with Nutanix
No DSA predictions article would be complete without making a call about Pure Storage. We have predicted their acquisition nearly every year and have always been wrong. This year, we are compelled to add them once again. Pure have become a powerhouse in the enterprise storage market – something we were sceptical they would be able to do (think of the other storage startups that emerged around the same time but fell by the wayside). However, we still struggle to see the end game. They don’t make profits and for a long time, their game plan was to take on the “EMC” market. EMC saw the future and saw convergence was inevitable, becoming part of a company built on “compute” made sense.
This is why we see a Nutanix-Pure combination as a strategy that makes sense. A hardware company needs to own all the infrastructure, not just storage or compute. A merged company would meet this need.
Consolidation Will Happen in the Endpoint Security Space
Malwarebytes, McAfee, Carbon Black, Sophos, Checkpoint, Blackberry Cylance, CrowdStrike, Bitdefender, FireEye, Kaspersky, Trend – hopefully you get the idea.
This is a crowded market, and we know the sheer number of players makes it difficult for companies to know which solution to select. We have seen a trend of larger vendors acquiring new players offering point solutions in this space, think of VMware and Carbon Black or Blackberry and Cylance. We expect this to continue with a few of the point players being snapped up or merging.
Blockchain Gets Hot (Again)
Two years ago, there was a lot of hype about blockchain. In fact, DSA published a special feature on “what is blockchain” and it was the most downloaded pdf from our portals in that year. The hype was driven by the talk about cryptocurrency and how blockchain was the enabler. We heard things like “blockchain will become as significant as the internet” and then the interest died down and coverage in the press subsided.
Over the last couple of years, the technology has become more understood, with many more players entering the space and the promised non cryptocurrency use cases becoming a reality.
We expect to see much more interest in blockchain this year, with adoption of the technology in multiple sectors, more mainstream usage and perhaps a few acquisitions of blockchain specialists by large global system integrators or cloud providers.
Note: These predictions have not been made using any knowledge or information provided by employees or people connected to the companies mentioned. They are speculative predictions made by our editorial staff and are intended as light-hearted views on possible ways the market may develop. As such, they should not be regarded as anything more than this.