Server market returns to growth in 2010 says Gartner
x86 refresh drives server market up 16.4% to $48.7bn in 2010
The worldwide server market returned to growth in 2010, according to Gartner.
The analyst company said that shipments were up 6.5% year-on-year for the last quarter of the year, with revenues up 16.4%. For the year as a whole, growth reached 16.8% and revenues hit 13.2%.
Gartner said that the growth was largely attributable to companies refreshing x86 servers, with shipments up 7.1% and revenue up 20.0% in Q4, following a slowdown in equipment replacement in 2009 due to the economic crisis.
Gartner warned however that while server market growth would continue in 2011, it is likely to be at a lower level as x86 replacement has mainly been fulfilled for now. Virtualisation of servers is also reducing the demand for new hardware.
"2010 was a year that saw pent-up x86-based server demand produce some significant growth on a worldwide level," said Jeffrey Hewitt, research vice president at Gartner. "The introduction of new processors from Intel and AMD toward the end of 2009 helped fuel a pretty significant replacement cycle of servers that had been maintained in place during the economic downturn in 2009."
The blade server segment showed good growth over the year, with revenue increasing to 29.5% and shipments hitting 12.6%. HP led the blade market with a 47.3% market share, with IBM taking 24.5%.
In the EMEA region, server revenue grew by 10.4% to $4.3bn in the fourth quarter, with shipments up 4.4% year-on-year, to 706,000.
"The fourth quarter rounded off an encouraging year for the server market in EMEA with each quarter seeing positive year to year growth rates for both shipments and revenues," said Adrian O'Connell, research director at Gartner. "EMEA was particularly badly hit by the downturn in 2009 and, although economic concerns continue across much of the region, the server market has shown good momentum during 2010."
While x86 and blade servers performed well, demand for Unix servers was weak, with EMEA revenue down 18.7% in Q4, with Unix vendors facing competition from x86 and IBM's high end System Z.
In the competitive landscape, HP and IBM continue to compete for the lead, with both taking 31% market share by revenue, and both achieving revenues of over $15 billion, while HP is the clear leader on shipments, with 31.7% market share. Gartner report that HP's x86 ProLiant range had been a strong performer, while IBM's System Z showed improved results in Q4.
Dell ranked third in market share by revenue, with 14.7% to $7.1bn, a growth of 31.3% from 2009, while Oracle was fourth, with revenues of $3bn, although growth was down by 17.7%. Fujitsu was fifth, taking a 4.4% market share, with revenue of $2.1bn, and growth of 5.1%.