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Cloud Growth Not Enough To Unseat Traditional IT Market

Newly released data from Synergy Research Group indicates that cloud computing still trails the traditional enterprise hardware market, despite growing faster any other IT category in 2017.

In a study released this week, Synergy found that datacenter servers accounted for the lion's share of all IT infrastructure spending in 2017, topping $30 billion globally, despite a 1 percent year-over-year decline. The leading datacenter server vendor for the year was HPE, according to Synergy.

In a close second was the category of network switches and routers, which was worth around $29 billion -- a 4 percent increase year over year. Unsurprisingly, networking old guard Cisco Systems was the top vendor in the switches/routers market.

[Click on image for larger view.] Source: Synergy Research Group

The hosted and cloud collaboration market came in at third place, despite growing by 13 percent year over year -- the fastest of the six categories that Synergy tracked. Spending in this category was just north of $20 billion in 2017.

"Despite a burgeoning public cloud market, enterprise IT infrastructure spending was still on the rise in 2017 and will be for the next five years," said Jeremy Duke, Synergy founder and chief analyst, in a prepared statement.

"The focus of that spending is changing, however, with a growing emphasis on hosted solutions, subscription-based business models and emerging technologies," Duke added. "Those changes will continue to present challenges for incumbent vendors and opportunities for new market entrants."

Microsoft was the leading hosted/cloud collaboration vendor in 2017, according to Synergy's findings.

Redmond was also second most-dominant vendor (behind leader Cisco) in the category of on-premises collaboration, which clocked about $15 billion for the year. Spending in this market dropped by roughly 6 percent year over year, however.

Synergy estimates that the overall enterprise IT infrastructure market was worth $113 billion in 2017.

About the Author

Gladys Rama is the senior site producer for Redmondmag.com, RCPmag.com and MCPmag.com.

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