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'Enterprise Infrastructure Refresh' Underway on Servers

In the midst of a "meaningful enterprise infrastructure refresh," server sales were up across all geographies in the first quarter of 2011, according to the latest server numbers from IDC this week.

Server factory revenues rose 12.1 percent year over year to $11.9 billion in the January-through-March period, marking the fifth consecutive quarter that IDC has recorded server revenue growth. Unit shipments also increased 2.5 percent to 1.9 million units, the second-highest total yet for a calendar Q1.

Volume systems, which encompass most Microsoft partner sales, were up nearly 9 percent in year-over-year revenues. There were even sharper jumps in midrange systems (28 percent) and enterprise systems (14 percent). A 12.5 percent increase in Unix server factory revenue was the first improvement in 11 quarters for the platform, which was particularly hard-hit by the economic downturn.

"This was the fourth consecutive quarter with double-digit year-over-year revenue growth as the market recovery extended from x86 servers to midrange Unix to high-end mainframe class systems for the first time in nearly three years," said Matt Eastwood, group vice president of enterprise platforms at IDC, in a statement.

Windows server demand closely tracked volume systems demand, with 10 percent year-over-year growth on revenues of $5.8 billion. That revenue represented 48.5 percent of overall quarterly factory revenue. Windows-based servers also accounted for 75 percent of quarterly server shipments.

On x86 server sales, HP led the market with 38 percent revenue share, Dell was second with 24 percent share and IBM held third at 16 percent share. It was the eighth consecutive quarter with year-over-year increases in the average selling prices for x86 servers, IDC reported.

"As virtualization adoption matures in the x86 server market, IDC sees customers moving from consolidation towards more automated private cloud models for their IT needs," said IDC analyst Reuben Miller in a prepared statement. "This drives a shift in focus towards lowering the cost per application through higher virtual machine server densities."

Posted by Scott Bekker on May 26, 2011 at 11:58 AM


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