Innovation concept (© peshkova / Fotolia.com)
Innovation concept (© peshkova / Fotolia.com)

In this new digital world, one of the trends that has been prevalent for many years now is the use of virtual data rooms, sometimes known as VDRs. However, this VDR is also known by another, much simpler name: the cloud. But this is not an accurate name and companies know this. Still, people store information in a virtual data room for business, personal and everything in between, and this makes for a very strong market.

The Difference between Cloud Storage and the Datacenter

Although many people use the term cloud storage interchangeably with virtual data storage rooms, there are some differences between the 2. For one thing, information stored in the cloud is stored in random servers around the internet. You don't necessarily know where the data you are getting is coming from when you access the cloud because there may be several servers with that information available. A VDR, on the other hand, is specifically intended to store data for a particular company on their network.

The Role of a VDR

It can be a little difficult to understand exactly what the role of a virtual data room is. One thing to keep in mind is that while you can store information just about anywhere you like, only a virtual data room can store physical servers and other equipment. Cloud storage makes use of these data servers if they are available, but a virtual data room is usually reserved for a specific company and safeguards are put in place to make sure that that data does not give shared with anyone who does not have access.

The Market for Virtual Data Rooms

This doesn't seem like it would be that large of a market, because most people, unless they are involved with it or network security, are not even familiar with the name of the storage centers. However, this is a huge market, because every company out there requires secure data storage and equipment to make it all run correctly.

The Industry Outlook for Virtual Data Centers

Virtual data rooms, which are also known as virtual data centers, have a very positive outlook in most areas of the world. Virtual data rooms are used by businesses for many purposes, but one of the most important ones is to share data securely during a merger.

Because of the security features that are available with virtual data rooms, businesses can share data securely and not worry about the information getting out and affecting stock prices or employees. They are able to distribute information internationally, between multiple users and do so securely, without the need for severe security measures that make it difficult to access information or cost a fortune.

What are Virtual Data Rooms intended for?

The virtual data room is intended to be a replacement for expensive plane tickets and site visits. For example, if a company is interested in acquiring another company and they need to look at secure documents that would previously have only been secure if they were to do a physical site visit, they can use a virtual data center to access the same documents without leaving their own office. During the due diligence process, and the disclosure involved in a merger or acquisition, looking at this sensitive data is arguably the most important part of the process. Potential investors and bidders we'll need to have this information when making their decision and a virtual data room provides them with that opportunity without the need for a physical visit.

Statistic: How essential is cloud storage for global consumers? (by age) | Statista
Find more statistics at Statista

The State of Virtual Data Centers in the Future

You may be wondering how the industry is changing for the future. The traditional use of a virtual data room has its roots in the merger and acquisition process, but that doesn't mean that it is where it is going to stay. In fact, the trend has already moved well beyond that. Although it is still used for secure data transmission for this process, the ability to store information and share it with the proper people is vital in a variety of areas. Secure collaboration and sharing is required for completion of tasks when a group is working together, or even win more than one company is working on a project. Many companies are already considering virtual data rooms even if they have no plans to merge with another company or two cell.

The Growth of the Industry

In the year 2015, experts estimate that more than $4 billion dollars we're spent on the process of mergers and acquisitions. This made it the biggest when it comes to money spent, and that comes hand-in-hand with the sharing of data. One of the statistics that no one ever believes is that all but 10% of the world's data was created just in the last couple years. Virtual data rooms are no longer the luxury, or a requirement for mergers and acquisitions, they are requirements no matter what a company is up to.

The Rising of Virtual Data Room Providers

Because so many businesses are moving on line, the growth of the virtual data room is very nearly absolutely certain. The virtual data room industry has been growing for years and experts are predicting the strongest growth is still yet to come. The virtual data room is going to become a tool as standard among businesses as the copy machine is now. In fact, the copy machine will probably become obsolete long before the virtual data room does

Statistics on the Industry and Size of the Market

Right now, experts have estimated that the total revenue of the virtual data room industry is $804 million dollars. That is a huge amount in comparison with the other industries that are out there. Right now, there are only about 315 businesses in the United States that are providing virtual data room services and nearly 2,800 employees. However, experts are forecasting the growth to be astronomical in the coming decade. You could easily see the annual revenue of the virtual data room industry move into the billions as the industry matures.



         



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