Welcome!

Containers Expo Blog Authors: Pat Romanski, XebiaLabs Blog, Yeshim Deniz, Aater Suleman, Elizabeth White

News Feed Item

Worldwide Server Market Rebounds Sharply in Fourth Quarter as Demand for x86 Servers and High-end Systems Leads the Way, According to IDC

According to the International Data Corporation (IDC) Worldwide Quarterly Server Tracker, factory revenue in the worldwide server market increased 3.1% year over year to $14.6 billion in the fourth quarter of 2012 (4Q12). This was the first quarterly increase of factory revenue in five quarters. Worldwide server shipments decreased 3.9% to 2.1 million units in 4Q12 when compared with the same period in 2011. For the full year 2012, worldwide server revenue decreased 1.9% to $51.3 billion when compared to 2011, while worldwide unit shipments decreased 1.5% year over year to 8.1 million units.

On a year-over-year basis, volume systems and high-end systems experienced 4.2% and 6.4% revenue growth to $9.1 billion and $4.1 billion respectively in 4Q12. At the same time, demand for midrange systems experienced a year-over-year revenue decline of 10.0% to $1.5 billion in 4Q12. The volume segment and high-end systems were both buoyed by a favorable technology refresh cycle with volume systems benefiting from continued demand for x86 servers deployed as part of consolidation and virtualization initiatives while increased spending for high-end systems was helped by strong demand for IBM System z mainframes.

"Despite experiencing the first quarterly growth in factory revenue in over a year, the server market continued to show signs of lumpiness in the fourth quarter," said Matt Eastwood, group vice president and general manager, Enterprise Platforms at IDC. "IDC forecasted that server demand would begin to improve in the second half of 2012 following a number of critical product refreshes which occurred in the first half of the year. While this did happen in the fourth quarter, market demand was uneven with the U.S., Asia/Pacific and Latin America all experiencing sharp growth, while demand in all other regions remained soft. Average selling prices for servers increased sharply in the quarter as large and small enterprises continued to invest heavily in new server capacity to drive additional consolidation and virtualization initiatives."

Overall Server Market Standings, by Vendor

IBM held onto the number 1 spot in the worldwide server systems market with 36.5% market share in factory revenue for 4Q12, as revenue increased 3.1% year over year. IBM experienced significant improvements in demand for its System z mainframes aided by a strong product refresh cycle. The fourth quarter also delivered the highest quarterly revenue IBM has achieved in System z in more than a decade. HP held the number 2 spot with 24.8% share for the quarter as revenue decreased 3.2% compared to 4Q11. Although HP experienced solid demand for its x86-based ProLiant servers, it was offset by weak Itanium-based Integrity server demand in the quarter. Dell increased server revenue by 5.7% year over year and maintained third place with 15.1% factory revenue market share in 4Q12. Three companies shared the number 4 market position, with Oracle, Fujitsu and Cisco all locked in a statistical tie* in 4Q12. Additionally, this was the first quarter that Cisco maintained a position in the top 5 server rankings.

Top Server Market Findings

  • Linux server demand was positively impacted by high performance computing (HPC) and cloud infrastructure deployments, as hardware revenue improved 12.7% year over year in 4Q12 to $3.0 billion. Linux servers now represent 20.4% of all server revenue, up 1.7 points when compared with the fourth quarter of 2011.
  • Microsoft Windows server demand continued to increase in 4Q12 as hardware revenue increased 3.2% year over year. Quarterly revenue of $6.7 billion for Windows servers represented 45.8% of overall quarterly factory revenue, the same share as in the prior year's quarter.
  • Unix servers experienced a revenue decline of 24.1% year over year to $2.6 billion representing 17.6% of quarterly server revenue. This was the sixth consecutive quarter of revenue decline in the Unix server market and all major Unix server vendors experienced a revenue decline when compared with the fourth quarter of 2011.
  • After five consecutive quarters of revenue declines, IBM's System z mainframe running z/OS increased revenue 55.6% year over year to $1.8 billion, representing 12.3% of all server revenue in 4Q12.

"The IBM System z mainframe platform had its highest quarterly revenue since 1997, generating nearly $2 billion and driving the overall server market to positive growth in the quarter," said Jean S. Bozman, Research Vice President in IDC's Enterprise Platforms Group. "This dramatic growth was due to several factors: technology refresh, new products such as zEnterprise, new accounts in emerging economies, and consolidation of some enterprise Linux workloads onto IBM System z, using the Integrated Facility for Linux (IFL) specialty engines. Although revenue results for System z are traditionally heavier in the fourth quarter, this accelerated acquisition shows the breadth and depth of the IBM mainframe installed base."

X86 Industry Standard Server Market Dynamics

The x86 server market experienced sharp revenue growth in 4Q12 as systems based on Intel's Sandy Bridge processor -- which was launched in early 2012 -- experienced strong demand which helped drive sharply higher average selling prices across the market. The x86 server market accelerated in 4Q12, increasing 6.0% in the quarter to $9.7 billion worldwide as unit shipments decreased 3.7% to 2.1 million servers. Despite the shipment decline, this is the highest quarterly revenue ever reported for x86 servers as the architecture accounted for 66.2% of all server spending. HP's x86 factory revenue increased 4.4% and it continued to lead the market with 32.7% revenue share. Dell experienced 5.7% year-over-year growth in x86 server revenue and retained second place with 22.9% revenue share. IBM continues to hold third place with 16.7% x86 server revenue share following a 2.3% year-over-year decline in revenue. Cisco moved into the fourth position in the market with 5.0% revenue share as a result of 50.7% revenue growth when compared to 4Q11, while Fujitsu and Oracle tied* for fifth position with 3.1% and 2.7% share respectively. As a result of a strong demand throughout the year, worldwide x86 server revenue for 2012 increased 4.1% to $35.8 billion, while worldwide x86 unit shipments decreased 0.4% to 8.0 million units.

Modular Form Factor Market Results

Servers in the modular form factor categories performed well in 4Q12. There are two types of modular form factors, each with a distinct use case. Blade servers, which are highly leveraged in enterprises' virtualized environments, grew 3.3% year over year to $2.4 billion. Blades now account for 16.3% of total server revenue. HP maintained the number 1 spot in the blade server market in 4Q12 with 44.7% revenue share; IBM and Cisco followed in second and third with 21.7% and 15.3% revenue share, respectively.

Density Optimized servers, utilized by large datacenters, experienced very strong demand in 4Q12. Revenue grew 66.4% year over year in 4Q12 to $705 million as unit shipments increased 44.2% to just over 192,000 servers. Density Optimized servers now represent 4.8% of all server revenue and 9.2% of all server shipments. Dell maintained the number 1 spot in the Density Optimized segment in 4Q12 with 50.8% revenue share. IBM and HP finished second and third in revenue share with 12.8% and 9.1%, respectively.

"Both types of modular form factors outperformed the overall server market, indicating customers are increasingly favoring specialization in their server designs," said Jed Scaramella, research manager, Enterprise Servers. "Density Optimized servers were positively impacted by the growth of service providers in the market. In addition to HPC, Cloud and IT service providers favor the highly efficient and scalable design of Density Optimized servers. Blade servers are being leveraged in enterprises' virtualized and private cloud environments. IDC is observing an increased interest from the market for converged systems, which use blades as the building block. Enterprise IT organizations are viewing converged systems as a method to simplify management and increase their time to value."

 

Top 5 Corporate Family, Worldwide Server Systems Factory Revenue, Fourth Quarter of 2012

(Revenues are in Millions)

Vendor    

4Q12
Revenue

   

4Q12 Market
Share

   

4Q11
Revenue

   

4Q11 Market
Share

   

4Q12/4Q11
Revenue
Growth

1. IBM     $5,343     36.5%     $5,180     36.5%     3.1%
2. HP $3,626 24.8% $3,747 26.4% -3.2%
3. Dell $2,218 15.1% $2,098 14.8% 5.7%
4. Oracle* $602 4.1% $733 5.2% -17.8%
4. Fujitsu* $501 3.4% $476 3.4% 5.3%
4. Cisco* $480 3.3% $319 2.2% 50.7%
Others $1,869 12.8% $1,641 11.6% 13.9%
 
All Vendors $14,639 100% $14,193 100% 3.1%
 

IDC's Worldwide Quarterly Server Tracker, February 2013

* Note: IDC declares a statistical tie in the worldwide server market when there is less than one percent difference in the revenue share of two or more vendors.

In addition to the table above, a graphic showing 4Q12 market share for the top 5 vendors in the worldwide market as well as in emerging and mature markets is available at IDC.com. The chart is intended for public use in online news articles and social media. Instructions on how to embed this graphic can be found by viewing this press release on IDC.com.

 

Top 5 Corporate Family, Worldwide Server Systems Factory Revenue, Full Year 2012

(Revenues are in Millions)

Vendor    

2012
Revenue

   

2012 Market
Share

   

2011
Revenue

   

2011 Market
Share

   

2012/2011
Revenue
Growth

1. IBM     $15,748     30.7%     $16,454     31.5%     -4.3%
2. HP $14,149 27.6% $15,300 29.3% -7.5%
3. Dell $8,165 15.9% $7,814 15.0% 4.5%
4. Oracle $2,660 5.2% $3,218 6.2% -17.4%
5. Fujitsu* $2,070 4.0% $2,492 4.8% -16.9%
5. Cisco* $1,610 3.1% $1,020 2.0% 57.9%
Others $6,873 13.4% $5,951 11.4% 15.5%
 
All Vendors $51,276 100% $52,249 100% -1.9%
 

IDC's Worldwide Quarterly Server Tracker, February 2013

* Note: IDC declares a statistical tie in the worldwide server market when there is less than one percent difference in the revenue share of two or more vendors.

IDC's Server Taxonomy

IDC's Server Taxonomy maps the eleven price bands within the server market into three price ranges: volume servers, midrange servers and high-end servers. The revenue data presented in this release is stated as factory revenue for a server system. IDC presents data in factory revenue to determine market share position. Factory revenue represents those dollars recognized by multi-user system and server vendors for ISS and upgrade units sold through direct and indirect channels and includes the following embedded server components: Frame or cabinet and all cables, processors, memory, communications boards, operating system software, other bundled software and initial internal and external disk shipments.

IDC's Worldwide Quarterly Server Tracker is a quantitative tool for analyzing the global server market on a quarterly basis. The Tracker includes quarterly shipments (both ISS and upgrades) and revenues (both customer and factory), segmented by vendor, family, model, region, operating system, price band, CPU type, and architecture. For more information, please contact Lidice Fernandez at 305-351-3051 or [email protected].

About IDC Trackers

IDC Tracker products provide accurate and timely market size, vendor share, and forecasts for hundreds of technology markets from more than 100 countries around the globe. Using proprietary tools and research processes, IDC's Trackers are updated on a semiannual, quarterly, and monthly basis. Tracker results are delivered to clients in user-friendly excel deliverables and on-line query tools. The IDC Tracker Charts app, available at iTunes, allows users to view data charts from the most recent IDC Tracker products on their iPhone and iPad.

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. IDC helps IT professionals, business executives, and the investment community to make fact-based decisions on technology purchases and business strategy. More than 1,000 IDC analysts provide global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. For more than 49 years, IDC has provided strategic insights to help our clients achieve their key business objectives. IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. You can learn more about IDC by visiting www.idc.com.

All product and company names may be trademarks or registered trademarks of their respective holders.

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
The age of Digital Disruption is evolving into the next era – Digital Cohesion, an age in which applications securely self-assemble and deliver predictive services that continuously adapt to user behavior. Information from devices, sensors and applications around us will drive services seamlessly across mobile and fixed devices/infrastructure. This evolution is happening now in software defined services and secure networking. Four key drivers – Performance, Economics, Interoperability and Trust ...
With billions of sensors deployed worldwide, the amount of machine-generated data will soon exceed what our networks can handle. But consumers and businesses will expect seamless experiences and real-time responsiveness. What does this mean for IoT devices and the infrastructure that supports them? More of the data will need to be handled at - or closer to - the devices themselves.
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place June 6-8, 2017, at the Javits Center in New York City, New York, is co-located with 20th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry p...
Grape Up is a software company, specialized in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market across the USA and Europe, we work with a variety of customers from emerging startups to Fortune 1000 companies.
In his keynote at @ThingsExpo, Chris Matthieu, Director of IoT Engineering at Citrix and co-founder and CTO of Octoblu, focused on building an IoT platform and company. He provided a behind-the-scenes look at Octoblu’s platform, business, and pivots along the way (including the Citrix acquisition of Octoblu).
Financial Technology has become a topic of intense interest throughout the cloud developer and enterprise IT communities. Accordingly, attendees at the upcoming 20th Cloud Expo at the Javits Center in New York, June 6-8, 2017, will find fresh new content in a new track called FinTech.
SYS-CON Events announced today that CollabNet, a global leader in enterprise software development, release automation and DevOps solutions, will be a Bronze Sponsor of SYS-CON's 20th International Cloud Expo®, taking place from June 6-8, 2017, at the Javits Center in New York City, NY. CollabNet offers a broad range of solutions with the mission of helping modern organizations deliver quality software at speed. The company’s latest innovation, the DevOps Lifecycle Manager (DLM), supports Value S...
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 20th Cloud Expo, which will take place on June 6-8, 2017 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 add...
Multiple data types are pouring into IoT deployments. Data is coming in small packages as well as enormous files and data streams of many sizes. Widespread use of mobile devices adds to the total. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will look at the tools and environments that are being put to use in IoT deployments, as well as the team skills a modern enterprise IT shop needs to keep things running, get a handle on all this data, and deli...
The Internet of Things is clearly many things: data collection and analytics, wearables, Smart Grids and Smart Cities, the Industrial Internet, and more. Cool platforms like Arduino, Raspberry Pi, Intel's Galileo and Edison, and a diverse world of sensors are making the IoT a great toy box for developers in all these areas. In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists discussed what things are the most important, which will have the most profound e...
@ThingsExpo has been named the Most Influential ‘Smart Cities - IIoT' Account and @BigDataExpo has been named fourteenth by Right Relevance (RR), which provides curated information and intelligence on approximately 50,000 topics. In addition, Right Relevance provides an Insights offering that combines the above Topics and Influencers information with real time conversations to provide actionable intelligence with visualizations to enable decision making. The Insights service is applicable to eve...
The 20th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held June 6-8, 2017, at the Javits Center in New York City, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal ...
SYS-CON Events announced today that Grape Up will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct. 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Grape Up is a software company specializing in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market across the U.S. and Europe, Grape Up works with a variety of customers from emergi...
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm.
SYS-CON Events announced today that T-Mobile will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. As America's Un-carrier, T-Mobile US, Inc., is redefining the way consumers and businesses buy wireless services through leading product and service innovation. The Company's advanced nationwide 4G LTE network delivers outstanding wireless experiences to 67.4 million customers who are unwilling to compromise on ...
@GonzalezCarmen has been ranked the Number One Influencer and @ThingsExpo has been named the Number One Brand in the “M2M 2016: Top 100 Influencers and Brands” by Analytic. Onalytica analyzed tweets over the last 6 months mentioning the keywords M2M OR “Machine to Machine.” They then identified the top 100 most influential brands and individuals leading the discussion on Twitter.
With major technology companies and startups seriously embracing Cloud strategies, now is the perfect time to attend @CloudExpo | @ThingsExpo, June 6-8, 2017, at the Javits Center in New York City, NY and October 31 - November 2, 2017, Santa Clara Convention Center, CA. Learn what is going on, contribute to the discussions, and ensure that your enterprise is on the right path to Digital Transformation.
20th Cloud Expo, taking place June 6-8, 2017, at the Javits Center in New York City, NY, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy.
Five years ago development was seen as a dead-end career, now it’s anything but – with an explosion in mobile and IoT initiatives increasing the demand for skilled engineers. But apart from having a ready supply of great coders, what constitutes true ‘DevOps Royalty’? It’ll be the ability to craft resilient architectures, supportability, security everywhere across the software lifecycle. In his keynote at @DevOpsSummit at 20th Cloud Expo, Jeffrey Scheaffer, GM and SVP, Continuous Delivery Busine...
New competitors, disruptive technologies, and growing expectations are pushing every business to both adopt and deliver new digital services. This ‘Digital Transformation’ demands rapid delivery and continuous iteration of new competitive services via multiple channels, which in turn demands new service delivery techniques – including DevOps. In this power panel at @DevOpsSummit 20th Cloud Expo, moderated by DevOps Conference Co-Chair Andi Mann, panelists will examine how DevOps helps to meet th...