Worldwide Enterprise External OEM Storage Systems Market Spending finishes with a 2.1% decline in 2023 but expected to grow an average of 4.3% over a 5-year period, According to IDC
In the fourth quarter of 2023 the external enterprise storage systems (ESS) market continued demonstrating softness by declining 1.2% year-over-year. This was the third quarter of decline in a row driven by the overall market slowdown, the aftermath of strong wave of spending in 2022, and redirection of spending / efforts on AI/GenAI initiatives, finally large companies are realizing the need to improve its data management and the infrastructure underneath to be able to take full advantage of AI endeavors. IDC expects an increasing demand for flash storage (typically, all-flash arrays) to support projects related to artificial intelligence, both for training and inferencing.
We believe that the market has reached its turning point and while some residual weakness is expected in early 2024, growing demand for storage systems will outweigh inhibiting factors such as continuous concerns about possibility of economic slowdown, political uncertainty, fiscal policies, and software-defined market dynamics, thus for 2024 we expect a pent-up demand after a period of slowdown with market growing 7.1% year-over-year.