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How Intel's Data Centre Business Is Being Affected By India's Digital Transformation Wave


How Intel's Data Centre Business Is Being Affected By India's Digital Transformation Wave


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With digital transformation driving the growth for companies in India, enterprises are heavily investing in data centres across the country for large scale adoption of technologies like artificial intelligence, cloud and data analytics, among others.

Last year, Intel saw exponential growth in India owing to large scale adoption of cloud and AI by enterprises in the country. In India, Intel has been increasing their data centre strategy since 2011 when its PC market witnessed a slump with the onset of mobile penetration. Ever since the company has found a steady market with India presently forming 1-2% of its overall data centre business.



Globally, in Q3, Intel’s data-centric businesses grew 22% year-on-year and the Data Centre Group (DCG) vertical clocked revenue of $6.1 billion. While in 2018, it stood at $6 billion in the third quarter with a growth of 26% year-on-year.

Mobile Consumption And AI Driving The Market

One of the primary reason for its growth in India has been attributed to the steady increase in mobile data consumption, pushing cloud and communication service providers to turn to data centres for quicker and faster processing of data-intensive work that relies on technologies like AI and ML.

Speaking to a business daily about how AI and analytics are driving the change in India, Rajeeb Hazra, corporate vice president, DCG at Intel, said, "We see tremendous opportunities in India for data, bound together by cloud-connectivity, which makes India a strategic region for our growth. The AI and analytics journey are just at the beginning and there is immense opportunity to derive value from the rapidly increasing volume of data."

Realising the potential of how AI and analytics can drive the future of data centres in India, Intel is currently developing tools and software to enrich their AI-ecosystem in an attempt to gain insight from data at the enterprise level. “Our focus in the near future is to build our data centre business through multiple strategies, and grow our cloud business in the space of computing, networking, storage, and memory solutions,” he said highlighting the company's future plans with regards to data centre.

India Connect

With its data centric-business estimated to grow by $200 billion in 2022, the company is entering a new era of data-centric computing in India and has increased its investment to the country substantially. In its two-decades of functioning in India, Intel has invested over ₹30,000 crore in the country.

With the introduction of Xeon Scalable in India, Intel hoped to make digital transformation for enterprises easier. Equipped with the new processor that enabled faster deep learning performance, the company received more than $1 billion in revenue from customers running AI on Intel Xeon processors in the data centre.

Added to this its tie-up with the Indian government for various government initiatives. In 2015, it partnered with Centre for Development of Advanced Computing (C-DAC) to launch ₹4,500 crore National Supercomputing Mission over the course of the next seven years. Although the project hasn't picked up steam so far, as per the initial reports the chip-maker was entrusted with the duty of establishing supercomputers at three IITs in a move to "enable India to leapfrog to the league of world-class computing power nations."

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Further, as part of its move to affirm its footprint in India, Intel unveiled SRR4, a design facility in Bengaluru with an investment of approximately ₹1,100 crore. The new facility with 620,000 sq. ft. of space including 100,000 sq. ft. of lab infrastructure, has been constructed with an aim to strengthen Intel's research and development in India.

Briefing about the centre Nivruti Rai, Country Head of Intel India and VP of Data Center Group, Intel Corporation, said, "Intel India plays a strategic role in Intel’s growth by making significant contributions to Intel’s technology and product portfolio in areas such as cloud, client, graphics, artificial intelligence, 5G and advanced driver assistance system.”

Outlook

One of the leading factors for Intel’s data centre growth in India will be the digital transformation and it will continue to fuel its growth. With 85% of the enterprises estimated to use AI in some way for the other globally, Indian enterprises cannot miss out on this tectonic AI shift. Massive AI adoption along with migration to the public cloud will continue to spurt Intel’s business.

Though Intel holds 95% of the data centre market, the mushrooming of competitors like Nvidia and Advanced Micro Devices (AMD) could pose a challenge. AMD recently in 2017, announced the launch of EPYC server chips for that is now used in the public data centres of Tencent, Microsoft Azure, and Baidu.



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