AI Boom Fuels the Next Wave of Cloud Storage Growth

AI Boom Fuels the Next Wave of Cloud Storage Growth

A recent global survey conducted by Recon Analytics, on behalf of Seagate Technology, offers valuable insights into the accelerating intersection of artificial intelligence and data storage.

As AI adoption surges across industries, business leaders from 15 sectors in 10 countries anticipate a data explosion—and they’re turning to cloud storage as the foundation for managing it. The shift is driven by the need for cost-effective, scalable storage solutions, with hard drives continuing to dominate due to their efficient terabyte-per-dollar performance. In fact, IDC reports that 89% of data stored by major cloud service providers currently resides on hard drives.

Cloud Storage on the Rise

According to the survey, 61% of companies that use the cloud as their primary storage method expect their storage needs to more than double within the next three years. In Singapore, 53% of businesses share this outlook, reflecting a strong—but slightly more conservative—growth trajectory.

Roger Entner, founder and lead analyst at Recon Analytics, noted, “The results point to a significant increase in demand for data storage, with hard drives emerging as the clear choice. As more business leaders plan to store AI-driven data in the cloud, cloud infrastructure appears poised for a second wave of growth.”

Key Insights from the Report:

• AI adoption is accelerating globally: 72% of businesses worldwide are actively using AI, compared to 62% in Singapore.
• Storage demands are surging: Over half (53%) of Singaporean companies using cloud storage predict a 100%+ growth in their needs over the next three years, closely mirroring global trends.
• Storage is critical to AI success: Globally, storage ranks as the second most important infrastructure component for AI—right after security. The top eight priorities are:
  1. Security
  2. Storage
  3. Data management
  4. Network capacity
  5. Compute
  6. Regulatory compliance
  7. LLM model viability
  8. Energy efficiency
• Longer data retention is becoming standard: 85% of Singapore-based organizations—and 90% worldwide—agree that storing data longer improves AI accuracy and reliability.
• Trustworthy AI is a top priority: 88% of AI users believe extended data retention is essential for training reliable models and ensuring quality outcomes.

The Future of Storage is Smarter and Denser

The findings reflect a clear trend: businesses are not only producing more data—they’re also holding onto it longer to enhance AI outcomes. This creates mounting pressure to develop storage solutions that offer higher capacity, faster performance, and lower cost per terabyte.

BS Teh, Seagate’s Chief Commercial Officer, emphasized, “Trustworthy AI is the key to widespread adoption. As organizations look to retain more data for longer durations, our focus is on delivering high-density storage innovations. Our HAMR-based hard drives are designed with a roadmap to more than double per-platter capacity in the coming years.”

Bottom Line

AI is transforming how companies generate, analyze, and act on data—and that transformation is demanding more from storage infrastructure. Cloud storage is evolving rapidly to meet the challenge, paving the way for more intelligent, efficient, and scalable solutions that can support the future of AI-driven business.