Cloud Storage Gateway Market to Reach $3.5 Billion

By Laura Stotler, TMCnet Contributing Editor  |  June 16, 2015

As big data volumes grow exponentially and more organizations across a broad range of markets migrate to the cloud, the need for bigger and better cloud storage is rising. New research from Markets and Markets forecasts the cloud storage gateway market is expected to grow from $909.2 million this year to a whopping $3.5 billion in 2020, representing a 31.5 percent CAGR.

The new Cloud Storage Gateway (News - Alert) Market by Type report correlates the growth rate with a massive rise in demand for cloud solutions to manage big data and provide backup and recovery services as well. The report divides the market into virtual cloud storage gateway appliances that do not require an API for access and physical cloud storage gateway appliances. The latter group acts as a bridge between local and cloud storage and encrypts data so it may travel to the desired location.

The report echoes even more aggressive research from TechNavio showing the global cloud storage gateway market will grow at a 64.30 percent CAGR from 2014 to 2019. That number is just slightly above the forecasted U.S. growth rate of 54.37 percent from 2015 to 2019.  Meanwhile in Europe, the same market will grow at a 73.04 percent CAGR from this year through 2019, driven by cost efficiencies and an exponential increase in the amount of cloud data and traffic being generated.

According to the reports, cloud storage gateways are broadly defined as hybrid appliances offering local and cloud storage solutions as well as data protection. They also act as gateways, providing compatibility among a variety of protocols used by cloud service providers and enterprises and offering seamless connectivity between local and cloud storage. Gateways also facilitate management of network traffic while optimizing storage space throughout the network.

Major hardware and software players in the cloud storage gateway arena include Amazon, CTERA Networks, EMC (News - Alert), Emulex, F5 Networks, HP, Microsoft and NetApp. Cloud storage services platform provider CTERA recently conducted its own survey on the enterprise cloud storage market, finding that security and data governance concerns are among the top factors driving adoption.

“Cloud storage is simplifying and accelerating data services across the enterprise,” said Rani Osnat, VP of strategic marketing at CTERA. “However, an increasing number of data leakage events, and a desire to exercise more control over file sharing and data protection are forcing organizations to investigate and deploy alternatives to public cloud storage services. In our second year of research, the trend continues, demonstrating that organizations are leveraging cloud storage for efficiency gains and cost savings, while combatting security, control and governance requirements with virtual-private or fully-private topologies."

Edited by Dominick Sorrentino