NetApp and SK Telecom Demonstrate Near Bare-Metal Presentation for Enterprise AI Workloads

On 10 July 2026, NetApp and SK Telecom announced a successful joint PoC, representing a significant breakthrough in South Korea's AI infrastructure. They combined Petasus AI Cloud with NetApp AFX storage to enhance systems for memory-intensive AI workloads in virtualized settings.

By joining NetApp AFX storage with SK Telecom's AI cloud, GPU utilization is enhanced, model training and inference are accelerated, storage efficiency is improved, and AI hardware investments are maximized. Traditionally, advanced AI was confined to bare-metal servers due to performance challenges with virtualization, but this PoC demonstrated that virtual machines can reach over 99% of bare-metal speed. These results facilitate scalable AI deployment, cost efficiency, and increased infrastructure flexibility. This enables organizations to adopt virtualization benefits like resource management, infrastructure control, workload isolation, scalability, disaster recovery, and security without sacrificing performance. The proof of concept shows that enterprise AI infrastructure is maturing, with software-defined architectures now matching the performance of dedicated hardware.

The companies will also explore how the validated architecture can support GPU-intensive cloud service use cases as customer requirements and deployment models continue to evolve. The infrastructure supports demanding AI tasks, including large language models, deep learning, NLP, recommender systems, computer vision, and scientific computing, all of which require high memory bandwidth and fast storage. As ICT expands across healthcare, telecommunications, finance, manufacturing, and research, these innovations will make high-end computing more resourceful, scalable, and cost-effective worldwide. Enterprises can consolidate workloads, quickly provision resources, and run multiple projects in virtualized environments without performance loss.

Impact on Cloud Data Center Industry

The global cloud data center market size was estimated at USD 32.28 billion in 2025 and is predicted to increase from USD 35.53 billion in 2026 to approximately USD 81.09 billion by 2035, expanding at a CAGR of 9.65% from 2025 to 2035.

According to Precedence Research, trends driven by cloud infrastructure are increasingly essential as generative AI, machine learning, big data analytics, and enterprise automation continue to expand. The AI optimization milestone reached by NetApp and SK Telecom is set to boost growth in the cloud data center sectors by improving AI workload deployment efficiency. Achieving near-bare-metal performance in virtualized environments represents a major step forward for enterprises looking to adopt AI at scale. This progress enable demand for AI cloud platforms, advanced storage solutions, GPU infrastructure, and optimized data center technologies.

Organizations will be able to deploy AI applications more flexibly while reducing reliance on dedicated hardware. The major technology provider focused on virtualization capabilities will help companies better optimize resources, reduce operational costs, and accelerate AI adoption. Cloud providers, storage technology companies, and data center operators are positioned to benefit from the rising demand for high-performance AI infrastructure.

Impact on Telecommunications Industry

The global telecommunication market size is estimated at USD 2.46 trillion in 2025 and is predicted to increase from USD 35.53 trillion in 2026 to approximately USD 4.46 trillion by 2035, expanding at a CAGR of 6.14% from 2025 to 2035.

According to Precedence Research, telecommunication companies can use AI to manage increasing data volumes, boost efficiency, and deliver personalized services. The AI optimization solution stands to significantly benefit the telecommunications industry by helping telecommunications operators integrate AI, cloud, and edge technologies. As they transition from traditional connectivity providers to digital platform operators offering advanced AI services, enhancing AI infrastructure can improve network management, automate processes, optimize 5G performance, and enhance customer experience.

A precedence report shows that AI can analyze network data, predict maintenance needs, and improve service reliability. The emergence of cloud-native telecom infrastructure creates opportunities for AI platform developers, automation specialists, and edge computing firms.  Combining AI with telecom infrastructure will foster innovations such as intelligent networks and autonomous operations. Leading companies focus on innovative digital products, thereby strengthening telecoms in the tech ecosystem and generating new revenue streams from AI-powered solutions.

Impact on the Enterprise AI Industry

The global enterprise artificial intelligence (AI) market size is estimated at USD 20.93 billion in 2025 and is anticipated to reach around USD 560.74 billion by 2034, expanding at a CAGR of 44.10% between 2025 and 2035.

According to Precedence Research, the breakthrough in AI optimization is poised to boost enterprise AI adoption and transform manufacturing by enabling organizations to deploy advanced AI applications more effectively. Manufacturing firms are increasingly integrated with AI for automation, robotics, predictive maintenance, quality assurance, and smart factory management. Manufacturers can leverage AI for real-time production monitoring, digital twins, supply chain management, and automated decision-making processes.

Small and medium enterprises can boost productivity, minimize equipment downtime, and improve operational efficiency through scalable AI systems. This development presents new opportunities for industrial AI software vendors, automation firms, cloud service providers, and developers of smart manufacturing technologies. As industries progress toward Industry 4.0. facilitates wider digital transformation by making AI more accessible, efficient, and practical for enterprises aiming to enhance competitiveness and foster innovation.

Expert Opinion

The breakthrough by NetApp and SK Telecom in AI optimization addresses a major business challenge by effectively deploying AI workloads while managing infrastructure costs. Experts believe that close-to-bare-metal performance in virtualized setups can greatly enhance AI access for companies. Gartner analysts highlight AI infrastructure optimization, cloud services, and scalable environments as key to enterprise AI adoption. This enables organizations to leverage flexible cloud infrastructure, optimize resource use, and reduce reliance on costly dedicated hardware. Enterprises sector implementing generative AI, digital twins, machine learning, and automation. Researchers stress that robust AI infrastructure will be a competitive edge as more businesses embed AI into their operations. Additionally, innovation is poised to boost demand for AI cloud platforms, advanced storage, data center solutions, and enterprise AI services, driving a shift towards scalable, cost-efficient AI deployment models.