Disparate and Slowing Quarter-on-Quarter Revenue Growth Points to a Server Spending Recovery That Remains Fragile in EMEA, Says IDC
London and
Prague – September 1, 2010 – According to
IDC’s EMEA Quarterly Server Tracker, the EMEA server market recorded positive
revenue and unit growth for the second consecutive quarter, with revenue up
annually by 4.9% to $3 billion, and units up by 15% to just over 520,000 server
shipments. Quarter-on-quarter results comparisons yield a more subdued performance,
indicating that the upsurge in the market initiated in 1Q10 remains fragile.
Factory revenue was down 3.7%, and units were also down 6.2%, in 2Q10 on 1Q10.
X86 server sales generated the largest revenue stream
in the market, at $1.9 billion, equivalent to 64.3% of the total in EMEA, an
increase of 30.2% year on year. Non-x86 servers continued to lose revenue share,
declining 22.4% annually to reach just over $1 billion,
“The server figures for 2Q10 confirm the major
role of x86 servers in IT transformation, in virtualization and consolidation
projects for datacenter infrastructure, in scale-out computing, and in
high-performance computing (HPC),” said Nathaniel Martinez, research
director in the Enterprise Server Group for IDC EMEA, “The sweet spot of
the server space continues to be two-socket configurations, and x86 blades are
the hottest growth segment.”
“Pent-up demand for new infrastructure, following
a long period of delayed investments, has created significant refresh activity
in the x86 segment, which IDC anticipates to extend to Unix and mainframe
servers in the second half of 2010,” said Beatriz Valle, senior research
analyst in the Enterprise Server Group for IDC EMEA.
Blade Server
Segment
Positive double digit annual revenue growth among top
three vendors in the blade segment pointed towards a restart of datacenter
projects among large organizations throughout the region, in particular with
some emerging markets in CEE and Africa booming with triple digit growth.
Mainstream 2-socket x86 servers were the real driving factor of the segment,
with 41% annual value growth, as x86-based blades covered 90% of the overall
blade value. Yet non-x86 blades finally saw initial signs of uptake, growing
revenue annually to $52 million, as the new generations of Itanium and Power 7
machines registered first shipments, which IDC expects to grow in the next two
quarters.
“IDC also observed good levels of activity in the
pure HPC segment, with specialized vendors such as SGI and Bull recording solid
performances once more. Organizations with more than 500 employees absorbed
around 57% of x86 blade shipments in EMEA as refreshes in the financial sector
installed base played a key role in driving demand,” said Giorgio
Nebuloni, senior research analyst in the Enterprise Server Group for IDC EMEA.
Emerging Markets
According to Stefania Lorenz, research director for
IDC CEMA, “The Central and Eastern European (CEE) subregion was the
fastest-growing geography, with revenue of $357.3 million, up 25.7%, and server
shipments growing 38.8% year on year. As a result, CEE, which had experienced
the most severe server spending contraction during the downturn, regained its
position as the second largest market in EMEA, in 2Q10.”
While Russia was CEE’s biggest economy in terms of absolute
size, Poland displayed the fastest growth rates, with server revenue up 43.3% annually.
In the Middle East and Africa (MEA), growth was more subdued, with revenue of $338.5
million, up 13.3%, and shipments also up 19.5% in 2Q10 on 2Q09.
Top Server Market Findings
- With x86 the main market engine, volume servers priced
below $25K generated nearly $2 billion, 65.2% of the total revenue, up from a
share of 53.5% in the same quarter of 2009. Volume systems represented 98.6% of
the x86 market, both in revenue and unit terms. Midrange server revenue, of
which 65.4% were RISC systems, was down 6.4% year on year. High-end server
revenue suffered double-digit declines of 28.9%, while volume servers
experienced growth of 28% in the same period.
- Bladed servers outperformed all form factors, with
annual growth of 30.1% annually to around $520 million in EMEA. Rack systems also
displayed robust growth of 19.7%, reaching $1.5 billion. It was the second
quarter of double-digit growth for rack systems, whose rate of annual growth, 23.2%
in 1Q10, was the fastest recorded by IDC since 1Q05, five years ago. The popularity
of racks is partly due to demand for standard 1 and 2 socket systems coming
from public cloud computing and hosting datacenters. Pedestal servers performed
badly, declining by 20.8% annually.
- Windows servers grew year on year at the same pace as
the x86 market average, with 29.4% growth. Windows server revenue reached $1.4
billion in 2Q10, nearly outstripping Unix server revenue by a factor of 2 to 1.
Unix server revenue was down 14.4% year on year, and mainframe’s z/OS revenue,
was also down, by 27.4%. Linux server revenue grew by 20.6%, exceeding the half
a billion dollar mark, spurred by strong demand in France, Germany, Benelux,
and the Nordics.
- RISC servers suffered the sharpest decline, down 25.2%
year on year, while CISC servers declined 23.1%. The decline was softer for EPIC
servers, down 12.1% year on year. New road map advancements of RISC and EPIC
server offerings released at the beginning of the year are expected to boost overall
demand during the second half of 2010. However, longer sales cycles, and
competition from the high-end of x86, provides a mixed outlook for RISC EPIC.
Vendor
Highlights
- HP
was the top vendor for the tenth consecutive quarter in EMEA in 2Q10, having achieved
double-digit annual growth, mainly due to sales of Proliant x86 servers, representing
81.8% of the total revenue for this vendor.
- IBM’s
Power Systems were the main revenue generator for the vendor, overcoming the
xSeries family by a very small margin. The xSeries line enjoyed annual growth
of 31.5%, on the back of overall strong market results for industry standard
technologies.
- Dell
enjoyed the fastest growth rate of all vendors, well above the market average,
and increased its share of the EMEA server revenue by nearly three percentage
points, thanks to sales of PowerEdge servers. Dell jumped up one position
within the top 5 server vendors.
- Oracle’s
SPARC Enterprise line of RISC Unix servers generated 71.8% of the revenue for
this vendor, and was up 3.9% quarter on quarter.
- Fujitsu
maintained its market share, growing annually by 5.6%. The vendor benefited
from strong results in its x86 Primergy family, which was up 13.2% annually.
Top 5
Corporate Vendor Family, EMEA Server Factory Revenue, 2Q10 (Millions)
|
Vendor |
2Q10 Revenue |
2Q10 Market Share |
2Q09 Revenue |
2Q09 Market Share |
2Q10/2Q09 Revenue Growth |
|
HP |
$1,200.34 |
39.4% |
$987.15 |
34.0% |
21.6% |
|
IBM |
$818.48 |
26.9% |
$902.13 |
31.1% |
-9.3% |
|
Dell |
$377.24 |
12.4% |
$277.46 |
9.6% |
36.0% |
|
Oracle |
$309.68 |
10.2% |
$392.92 |
13.5% |
-21.2% |
|
Fujitsu |
$174.06 |
5.7% |
$164.88 |
5.7% |
5.6% |
|
Other |
$164.10 |
5.4% |
$177.45 |
6.1% |
-7.5% |
|
Total Market |
$3,043.90 |
100.0% |
$2,901.98 |
100.0% |
4.9% |
Source: IDC’s EMEA Quarterly Server Tracker, August 2010
IDC’s EMEA Quarterly Server Tracker is a quantitative
tool for analyzing the 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, country, operating
system, price band, CPU type, and architecture. For more information, please
contact Nathaniel Martinez on +44 (0) 20 8987 7184 or email nmartinez@idc.com,
contact your local IDC office, or visit www.idc.com.
For more information, contact:
Nathaniel Martinez
nmartinez@idc.com
+44-208-987-7184
Mathew Heath
mheath@idc.com
+44-208-987-7107
