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Enterprise Needs Driving Cloud Sales Boom

September 16, 2015 by  
Filed under Computing

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The cloud continues to gain major ground, driven by enterprise storage needs.

Sales are way up for little-known manufacturers that sell directly to big cloud companies like Google and Facebook, while the market for traditional external storage systems is shrinking, according to research company IDC.

Internet giants and service providers typically don’t use specialized storage platforms in their sprawling data centers. Instead, they buy vast amounts of capacity in the form of generic hardware that’s controlled by software. As users flock to cloud-based services, that’s a growing business.

Revenue for original design manufacturers that sell directly to hyperscale data-center operators grew by 25.8 percent to more than US$1 billion in the second quarter, according to the latest global IDC report on enterprise storage systems. Overall industry revenue rose just 2.1 percent from last year’s second quarter, reaching $8.8 billion.

These so-called ODMs are low-profile vendors, many of them based in Taiwan, that do a lot of their business manufacturing hardware that’s sold under better known brand names. Examples include Quanta Computer and Wistron.

General enterprises aren’t buying many systems from these vendors, but the trends at work in hyperscale deployments are growing across the industry. Increasingly, the platform of choice for storage is a standard x86 server dedicated to storing data, according to IDC analyst Eric Sheppard. Sales of server-based storage rose 10 percent in the quarter to reach $2.1 billion.

Traditional external systems like SANs (storage area networks) are still the biggest part of the enterprise storage business, logging $5.7 billion in revenue for the quarter. But sales in this segment were down 3.9 percent.

Overall demand for storage capacity continued to grow strongly, with 37 percent more capacity shipped in the quarter compared with a year earlier.

Source-http://www.thegurureview.net/aroundnet-category/enterprise-storage-needs-driving-cloud-sales-boom.html

HP Retakes Server Lead

December 17, 2013 by  
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Hewlett-Packard reclaimed its server crown from IBM last quarter as the overall market contracted and Taiwanese vendors made big gains selling directly to Internet giants like Google and Facebook, according to an IDC report.

HP expanded its share of the market only modestly from a year earlier but IBM’s portion declined 4.5 points despite solid mainframe sales, to leave HP in the top spot. HP finished the third quarter with 28.1% of worldwide server revenue to IBM’s 23.4%, IDC said.

But the strongest growth was for the “ODM direct” segment which IDC broke out for the first time this quarter. It stands for original design manufacturers, which are Taiwanese firms like Quanta Computer, Wistron Group, Inventec and Compal, which sell partial and fully-built servers to the big cloud providers.

It’s a growing segment and one that threatens the incumbents. ODM’s accounted for 6.5% of server revenue last quarter, up 45.2% from a year earlier, IDC said. If the ODM category were a single vendor, it would be the third largest ahead of Dell.

Almost 80% of the ODM’s server revenue came from the U.S., primarily from sales to Google, Amazon, Facebook and Rackspace.

Overall, the server market declined 3.7% from a year earlier to $12.1 billion. It was the third consecutive quarter of declining revenue but IDC predicts improvement with a refresh cycle early next year. In terms of units shipped, volumes were about flat year over year, meaning average selling prices dropped.

Volume systems — mostly x86 servers — picked up slightly from last year, with 3.5% revenue growth. But sales of midrange and high-end systems dropped 17.8% and 22.5%, respectively, IDC said.

IBM fared worst of the top 5 vendors, with revenue down 19.4% due to “soft demand for System x and Power Systems,” IDC said. Dell retained third place with 16.2% of revenue, about flat from last year, while Cisco Systems and Oracle tied for fourth.

Cisco saw the most growth of the top vendors, with a nearly 43% revenue jump, IDC said.

Source