April 3

How Hyperscalers Are Changing The Tech Industry

The economy moves through up and down cycles, which affects businesses of all sizes, but usually in different ways. During upcycles, many new companies enter the market while downturns often weed out the most financially troubled firms. The most resilient technology companies tend to be hyperscalers, which are giants like Apple, Microsoft, Google, Amazon, and Meta.


What is a Hyperscaler?

Hyperscalers are large cloud services providers that provide computing and storage services and can support apps and microservices at enterprise scale, The name is derived from the term "hyperscale computing" which is a methodology that allows software architecture to scale and grow with increasing demand. Enterprise applications require flexible computing environments that adapt to the fluctuating workload.

By giving their clients access to readily available scalable infrastructure - using the infrastructure-as-a-service (IaaS) model -, hyperscalers allow their clients to build and run, any type of innovative application, while also allowing them to scale and shrink resources on an as-needed and pay-as-you-go basis. IaaS became popular in the early 2010s, and it has become the standard computing model for many types of workloads. IAAS is the foundation layer of cloud computing and enables teams to reserve and provision computational resources. Cloud services like Software as a service (SaaS), Functions as a service (FaaS) or serverless, Containers as a service (CaaS), and microservices are built on the IaaS layer.


The History of Hyperscalers

Many of the new internet technologies this century were introduced and popularized by hyperscalers. Near the start of the new millennium, Google helped usher in cloud computing while proving that the reliability of expensive servers is not a factor with scalability. The search giant proved it by using slower computers running the Linux operating system instead of UNIX or Windows.

Microsoft, Amazon, and IBM became pioneers in cloud computing, blazing trails for many tech companies to sell products online with the help of cloud services. The rise of cloud platforms developed by hyperscalers that attract a large user base has helped many businesses go global and offer 24/7 service.

The current wave of hyperscalers is focused on improving cybersecurity, due to the steady rise in cybercrime. As powerful as large tech companies are, they must protect the privacy of their customers, since they've scaled up into millions of users. A cyber breach can hurt a hyperscaler's credibility, so such large organizations must make cybersecurity a top priority.


The Rise of Hyperscalers

In this race toward big data, there are businesses of all sizes. Large companies tend to build private networks, while small companies often use public clouds to save money. Mid-sized companies tend to adopt hybrid cloud solutions. The need for businesses to hyperscale, or make scaling adjustments quickly, grows larger each day.

The name hyperscalers is usually applied to companies with large data centers that provide numerous IT services. Some other well-known hyperscalers include semiconductor companies AMD and Intel, as well as major tech developers such as Ericsson, IBM, and Oracle.

The rise of hyperscalers has paralleled mass cloud migration. The concept of the cloud alone attracts businesses to it because it delivers software services at a fraction of the cost businesses used to pay for software licensing. One of the biggest challenges for hyperscalers in the future will be the management of big data, which includes cybersecurity. It also embodies the solution of edge computing, which helps reduce latency.

While hyperscalers have made it possible for ordinary businesses to adopt IoT technology, there is still a need to prioritize critical data over less important data. Critical data should be stored on more than one additional server. Using a virtual private network (VPN) is one of the safest solutions for protecting confidential data.


Hyperscaler Market Forecast

The big three hyperscalers today are Amazon Web Services (AWS), Microsoft Azure, and Google Cloud. The combination of just these three players accounts for 76 percent of the cloud market, according to Synergy Research Group. AWS leads the pack with a 34 percent market share, followed by Microsoft with 21 percent and Google with 11 percent.

One of the biggest financial challenges the hyperscaler market faces now is overcoming inflation, which has caused many businesses to tighten their budgets. Although slimmer budgets will lead to fewer cloud deployments, this dynamic opens the door to competition for the pay-as-you-go model.

The market for global data center colocation is expected to grow to $109 billion by 2027, according to Structure Search. Now countless companies are aiming to grab a piece of the cloud market share.


The Impact of IoT on Hyperscalers

Driven by the growing importance of IoT, Hyperscalers are extending their infrastructure to the edge and are developing IoT platforms. Because IoT applications, just like enterprise applications, need a scalable infrastructure. The second trend that we are currently witnessing, is the rise of the intelligent edge. More and more sensors are deployed at the edge, computing is pushed from the cloud to the edge to crunch the data, and the availability of edge computing and the need for real-time response has led to the development of edge AI.

Both trends are drivers behind the growth of the hyperscale edge computing market. The Hyperscale Edge Computing Market size was valued at USD 2 billion in 2021 and is expected to grow at over 30% CAGR through the end of this decade, according to Global Market Insight.


The Artificial Intelligence of Things (AIoT) Revolution

Edge Computing is a key enabler for many future technologies, and it is the primary driver of AIoT; it moves data processing from the Cloud to the edge. But the vision of the AIoT is the vision of the intelligent edge namely, to create an intelligent network of devices capable of gathering and analyzing data remotely and translating that data into insights and real-time actions. It also enables a wide variety of use cases that simply weren’t realistic before.

One element of this vision is the inversion of the cloud model. The rapid increase of IoT devices – according to some forecasts there will be more than 75 billion IoT devices by 2025 — results in an explosion of the amount of data generated. The cloud infrastructure, storage, and connectivity solutions cannot scale to keep up with this data explosion, and more intelligence and data crunching will need to be deployed at the edge. This also has an impact on the hyperscalers because it means that the hyperscalers will have to follow the inversion of the cloud model.


IoT Infrastructure Using the Cloud or Edge

When developing an IoT infrastructure a key decision is whether cloud or edge computing works best, it typically boils down to latency and cost. If a company aims for minimal latency in its data transmission from IoT devices, the more reliable solution is edge computing. The AIoT revolution doesn't make this discussion mute, it puts it in a sharper context. Because computing power at the edge will be limited, companies will have to decide which data will have to be processed on the edge for real-time response, which data will have to be stored in the cloud, and which data can be deleted.


Leveraging the Power of Hyperscalers

It's common for hyperscalers to provide IoT-based hyperscale tools for their users. And then there are companies like Triotos that assist in lowering development costs and simplifying setup of IoT devices on a hyper scale platform to create any size IoT solutions that scale. Triotos has developed an IoT implementation platform based on the AWS IoT platform and associated AWS-based services and applications.

The Triotos platform offers a complete set of customizable web and mobile applications and supports rapid integration of new IoT devices, tools supporting application development and integration with external data sources, and mobile connectivity solutions.

Click the link for more information about the Triotos IoT solution in the “Creating Anysize IoT Solutions that Scale” whitepaper.


Conclusion

IoT is constantly evolving as a data delivery medium, as it can impact the scalability of a business. Although economic pressures may slow down IoT deployment, it's clear that IoT is here to stay. It's also clear that IoT makes a business more competitive due to faster communication and decision-making. Look for hyperscalers to continue building a digital ecosystem that makes an enterprise more scalable and sustainable.

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Tags

AIoT, big data, cloud computing, cloud services, FaaS, green technology, hyper scaler, hyperscale, hyperscale computing, IaaS, IoT


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