AI Powered Storage Market Size, Share & COVID-19 Impact Analysis, By Storage System (Direct Attached Storage (DAS), Network Attached Storage (NAS), and Storage Area Network (SAN)), By Storage Architecture (File-Based and Object-Based), By Storage Medium (Hard Disk Drive (HDD) and Solid State Drive (SSD)), By End-user (Enterprises, Telecom Companies, Cloud Service Providers (CSPs), and Government Bodies), and Regional Forecast, 2023-2030

The AI powered storage market size was valued at USD 18.56 billion in 2022 and is projected to grow from USD 22.90 billion in 2023 to USD 110.68 billion by 2030, exhibiting a CAGR of 25.2%. North America dominated the global market with a share of 35.34% in 2022.

AI powered storage systems are optimized and designed to fulfill the requirements of AI workloads, which often encompass high-throughput data access, large datasets, and complex data processing. These storage systems are crafted to ensure suitable performance, scalability, and reliability, addressing the needs of AI applications.

The growth of the AI powered storage market can be attributed to several factors. These include the burgeoning volumes of data, increasing demand for AI in HPC data centers, and the rising adoption of cloud-based services. Moreover, the imperative to enhance the storage architecture of the global enterprise infrastructure and the escalating adoption of data analytics for informed decision-making are propelling the global market share. According to the Global DataSphere forecast for 2021-2025, 181 zettabytes of data will be generated by 2025.

COVID-19 IMPACT

Increased Need for Cutting-Edge Solutions during COVID-19 Pandemic Fueled Market Progress

During the peak of the COVID-19 pandemic, the adoption of AI powered storage steadily increased. To facilitate more comfortable remote working conditions, there was a surge in demand for cutting-edge solutions. This demand also spurred the development of novel, creative methods employing Artificial Intelligence (AI) and Machine Learning (ML). Many businesses had already initiated implementing AI-powered data storage systems to enhance their business models and expedite their turnaround by enabling real-time data storage and analysis. Consequently, global investments in the market experienced a significant increase.

For instance:

• In August 2023, Lenovo announced an additional USD 1 billion investment in AI over the next three years. This investment aims to concentrate on providing AI-ready and AI-optimized computing infrastructure, AI devices, and embedding AI content into smart solutions for vertical industries.

LATEST TRENDS

Increased Usage of AI Management Tools for Infrastructure Management to Propel Market Growth

AI powered storage is becoming essential to meet the growing demand for utilizing and managing AI tools. This is due to the increased complexity of enterprise IT stacks and the continual emergence of new applications such as Big Data, containers, and multi-cloud solutions.

Businesses are leveraging AI management tools provided by data storage providers to establish three layers of governance architecture. These layers integrate intelligent device management, data center operations, and cloud functionalities. This approach facilitates infrastructure management and enhances operational efficiency, while also establishing a new AI incubation and release process to better adapt to AI transformations. As a result, customers benefit from an enhanced experience, making this factor a key trend in the market.

DRIVING FACTORS

Rising Uptake of Cloud-based Services to Aid Market Growth

In the business sector, cloud applications have triggered a significant revolution, particularly during the pandemic. The unlimited flexibility and reliability offered by cloud computing platforms have prompted numerous businesses to adopt cloud-based services. Furthermore, these services provide extensive adaptability and environmental friendliness, which will further bolster the AI powered storage market growth.

While modern storage systems and applications can store large datasets and generate actionable information, progressing without the intelligence and automation of AI powered storage solutions is challenging. AI powered storage systems streamline the optimization of data and storage for businesses, making it easier to manage. Consequently, several companies are leveraging these solutions, contributing to the market's growth.

RESTRAINING FACTORS

Lack of Experienced Professionals and Knowledge of AI Hardware to Hinder Market Expansion

Due to the emergence of new automation technologies, the market lacks experienced professionals who can advise consumers on the advantages of analytics solutions and effectively utilize them to gain useful information and insights. Moreover, implementing AI powered storage systems is challenging and costly, demanding substantial investments and skilled personnel capable of understanding AI hardware. Addressing this challenge is crucial to achieving widespread adoption of this product in high-volume sectors.

SEGMENTATION

By Storage System Analysis

Exceptional Features Offered by Direct Attached Storage (DAS) to Increase Its Demand

Based on storage system, the market is segmented into Direct Attached Storage (DAS), Network Attached Storage (NAS), and Storage Area Network (SAN). In terms of market share, the Direct Attached Storage (DAS) segment dominated the market in 2022. Due to its high speed of access and transfer, DAS is more suitable for meeting high-performance data storage needs. Data scientists and AI practitioners can spend less time waiting for a transfer and focus more on model development and optimization with DAS solutions that offer low latency access to data.

The Storage Area Network (SAN) segment is expected to record the highest CAGR during the forecast period. The segment's growth is attributed to the high utilization of SAN in SMEs due to its low implementation costs. This network of storage devices allows data centers to collaborate in storing large amounts of information. SAN offers several advantages, including the elimination of bandwidth bottlenecks caused by LAN-based server storage, high availability, centralized data management, faster backups, a global file system, rapid data migration, improved security, enhanced data protection, and more. Moreover, in order to accommodate the requirements of AI-enabled infrastructure applications and workloads, companies are seeking to expand their storage capacity beyond their current limits.

By Storage Architecture Analysis

Rapid Data Usage across File Protocols to Boost Demand for File-based Storage Architecture

Based on storage architecture, the market is segmented into file-based and object-based. In terms of market share, the file-based segment dominated the market in 2022. The segment's dominance is attributed to high data usage across common file protocols, making file-based storage architecture the obvious choice among organizations. For file-based architecture, applications such as AI-driven image recognition and categorization engines are utilized. However, this type of architecture has limited capacity for storing data and is not suitable for large datasets.

The object-based segment is expected to record the highest CAGR during the forecast period. Object-based storage architecture provides the most scalable structure and is well-suited for storing large amounts of data required for AI and ML applications. It offers file management features for specific applications, such as the Virtual Machine File System, among others. Object-based storage architecture assists organizations in efficiently sifting through and extracting usable data from a vast, continuously expanding database required for training models.

By Storage Medium Analysis

HDDs to Gain Significant Momentum to Keep Up With Various AI Applications

Based on storage medium, the market is segmented into Hard Disk Drive (HDD) and Solid State Drive (SSD). The Hard Disk Drive (HDD) segment dominated the market share in 2022. HDDs are widely used to keep pace with Artificial Intelligence (AI) applications and support both AI and data workloads due to their capability to write data at high speeds. The supply chain crisis triggered by the COVID-19 pandemic compelled large data centers and enterprise customers to purchase more storage products than necessary.

The Solid State Drive (SSD) segment is expected to register the highest CAGR during the forecast period. Businesses are increasingly employing tools to compress and delete unnecessary data, thereby freeing up crucial storage space in their SSDs. This holds significance for companies requiring extensive data space to enhance their performance, efficiency, and customer service. Through an agile and dynamic storage infrastructure, companies can achieve impressive performance, faster boot times, and improved reliability by reducing SSD data.

By End-user Analysis

Enterprises to Increase Product Use Due to Rising Need for Continuous Real-time Updates to Optimize Data

On the basis of end-user, the market is classified into enterprises, telecom companies, Cloud Service Providers (CSPs), and government bodies. The enterprise segment held dominance in the market in 2022. AI powered storage provides continuous real-time updates from diverse business sources, optimizing data and executing intelligent automated operations without human intervention. Additionally, key players are launching various upgrades or enhancements for enterprises. For instance:

• In December 2022, NVIDIA introduced Magnum IO GPU Direct Storage, facilitating a direct data storage path from local or remote storage to GPU memory, thereby enhancing AI performance, supported by NVIDIA's AI Enterprise 3.0. This release offered users a broader range of virtualization options, including VMware vSphere 8 and Red Hat Enterprise Linux with KVM.

The government bodies segment is expected to record the highest CAGR during the forecast period. Platforms supporting AI systems for government bodies must scale and unify AI workloads across hybrid cloud or multi-cloud platforms for training, inferencing, ROI, and analytics, simplifying and accelerating IT infrastructure. Governments are embracing cutting-edge technologies such as AI to enhance their activities, services, and intelligence capabilities in a dynamic technology landscape. Optimizing data storage is a crucial element that can revolutionize how agencies manage vast and mission-critical datasets.

REGIONAL INSIGHTS

Regionally, the market is studied across regions, such as North America, Europe, Asia Pacific, South America, and the Middle East & Africa.

North America dominated the global market with a share of 35.34% in 2022. Enterprises in the region have started adopting AI powered storage systems to safeguard their critical data, driven by increasing technological advancements and digitization in this field. Furthermore, the region benefits from the strong presence of key players in the data storage industry, heightened awareness, the availability of trained professionals, and the expanding use of AI within the financial sector, all contributing to the market's growth.

Asia Pacific is expected to display the highest CAGR during the forecast timeline. The increase in the use of robotics across various industries and the rising demand for cloud-based services are major contributors to the regional market's growth. Additionally, rapid internet penetration, the use of social networking applications, and the increasing digitization of businesses in the region are expected to drive market growth over the forecast period.

The Middle East & Africa are expected to register the second-highest growth rate in the global market in the upcoming years. This growth is attributed to increasing data usage and advancements in cloud technologies utilized for AI powered storage in the region.

KEY INDUSTRY PLAYERS

Market Players to Announce Mergers & Acquisitions, Partnerships, and New Product Launches to Promote Reach

Some of the key market players are offering cost-effective software-defined storage solutions for real-time updates and data optimization. These companies are acquiring small and local enterprises to expand their business operations and market presence. Additionally, strategic partnerships, mergers & acquisitions, and substantial investments in new product development strategies will aid these firms in expanding their market reach.

List of Key Companies Profiled:

• NVIDIA Corporation (U.S.)


• Intel Corporation (U.S.)


• Pure Storage, Inc. (U.S.)


• Infortrend Technology Inc. (Taiwan)


• Huawei Technologies Co., Ltd. (China)


• IBM Corporation (U.S.)


• NetApp (U.S.)


• Hewlett Packard Enterprise Development LP (U.S.)


• Dell Inc. (U.S.)


• Micron Technology, Inc. (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• October 2023: Pure Storage, Inc., an advanced data storage technology and service provider, enhanced its Evergreen portfolio to pay for its customers’ rack space and power costs for Evergreen’s Flex subscriptions and One Storage-as-a-Service (STaaS). The company also expanded its Evergreen range with new zero data loss, no data migration, and power & space efficiency guarantees complemented by flexible upgrades and financing.


• July 2023: Lenovo launched a new range of innovative data management solutions through ThinkSystem DG and DM3010H Enterprise Storage Arrays. This launch would make it easier for organizations to enable the use of AI workloads and unlock value in their data.


• June 2023: Dropbox, a cloud storage provider, launched a suite of AI products designed to simplify knowledge work. To enhance productivity, streamline processes, and deliver a more personalized work experience for users, the company rolled out new products, such as Dropbox Dash and Dropbox AI.


• March 2023: NVIDIA announced the NVIDIA DGX Cloud, an AI supercomputing offering that provides enterprises with instant access to the software and infrastructure required to train advanced models of generative AI, storage, and other groundbreaking applications.


• December 2022: IBM announced that it added storage solution roadmaps and Red Hat partner groups to the IBM Storage business unit, which would bring consistency in data and application through cloud and on-premises infrastructures.

REPORT COVERAGE

The report provides a detailed analysis of the market and focuses on key aspects, such as leading companies and top end-users of the product. Besides, the report offers insights into the latest market trends and highlights key industry developments. In addition to the factors mentioned above, the report encompasses several factors that have contributed to the growth of the market in recent years.

REPORT SCOPE & SEGMENTATION