India Server Market witnesses 14.2% increase in revenue in Q1 201: IDC India

As per the latest IDC Asia-Pacific excluding Japan (APEJ) Quarterly Server Tracker, Q1 2017, the overall server market in India witnessed a quarter-on-quarter (QoQ) increase of 14.2 per cent in terms of revenue to reach $215.6 million in Q1 2017 as against $188.8 million in Q4 2016. The x86 server market accounted for 90.7 per cent of the overall server revenue during Q1 2017 with growth being majorly driven by spending of public cloud service providers for their data centers.

The public cloud uptake and digital transformation across banking and government verticals are driving the server market in India. The x86 server market in terms of revenue witnessed a year-over-year (YoY) growth of 3.9 per cent to reach $195.6 million in Q1 2017 up from $188.2 million during Q1 2016.

The enterprise migration to cloud and role of emerging technologies such as Artificial Intelligence, IoT and analytics are attracting the global public cloud providers to expand their footprints in India. Density optimized servers are mostly preferred for cloud workloads which are gaining traction, accounting for QoQ growth of 413.6 per cent in terms of revenue for Q1 2017 over previous quarter.

The non x86 server market declined by 22.3 per cent YoY in terms of revenue to reach $20.0 million in Q1 2017. In terms of revenue, IBM led the market, accounting for 50 per cent of market share, while HPE remained the only vendor who grew its share to 17.8 per cent during Q1 2017. In non x86 server market banking industry on its own contribute for 57.3 per cent of the revenue, followed by manufacturing and professional services verticals.

Rishu Sharma, Associate Manager, Enterprise Infrastructure, added, "Professional services, telecommunications and banking remained the top three verticals, accounting for about 70% of the overall market. The market is likely to be driven by Digital initiatives, SAP HANA implementations and cloud workloads in the coming quarters."

In India x86 market, HPE increased its market share from 37.8 per cent in Q4 2016 to 40.3 per cent in Q1 2017 in terms of revenue, followed by Dell with a market share of 20.5 per cent during Q1 2017.Though the market increased Y-o-Y in terms of revenue most of the major vendors failed to maintain their market share, while ODMs have been successful in growing their market share from 0.3 per cent in Q1 2016 to 14.5 per cent in Q1 2017 and Cisco increased its market share to 8.9 per cent in Q1 2017, mainly driven by its blade revenue.

"ODMs have disrupted the India server market during Q1 2017 by strategically positioning themselves in public cloud and third-party data center space and are challenging the established vendors with their attractive pricing," says Harshal Udatewar, Server Market Analyst, IDC India.

Tags: India Server Market, IDC India, APEJ Quarterly Server Tracker, Rishu Sharma Enterprise Infrastructure, x86 market, HPE, IDC, SAP HANA, Harshal Udatewar Server Market Analyst IDC India