Server shipments are slightly up but revenues are down within the third quarter, and Unix server sales continue to slip, says Gartner report.
It’s not a very good year to be within the server business. Pity especially the poor Unix server salesperson in Europe.
Gartner on Wednesday released third-quarter server market estimates that show that total worldwide shipments were up 1.9% from the prior-year quarter to only over 2.5 million units while total server revenues were down 2.1% to $12.3 billion.
“The global server market remains in a comparatively weak performance mode as we go through the second one 1/2 the year,” said Jeffrey Hewitt, research vice chairman at Gartner, in an announcement.
Server revenues grew strongly within the Middle East and Africa (up 12.1%) and modestly in Canada (up 6.5%), but were flat or declined in all other regions. Europe all over again suffered the steepest declines.
[ Want more at the impact of slow server sales? Read IBM Hardware Slide Drags Down Q3 Results. ]
“Revenue [in Europe] has now declined for nine consecutive quarters and shipments have declined for eight,” said Gartner research director Adrian O’Connell. “Server revenue across EMEA is at its lowest level for over 15 years, which underlines the increasing contraction of the server market.”
Looking at results by product category, RISC/Itanium Unix servers once more suffered a steep decline, a pattern that has persisted all year long. Unit shipments within the category were off 4.5% from last year while revenues declined a whopping 31%.
“The fourth quarter is sometimes the strongest quarter of the year for [RISC/Itanium Unix] platforms, but even a powerful end to the year shouldn’t change the long run downward trend,” said O’Connell.
Some IBM customers are consolidating Unix workloads onto mainframes, however the bigger trend is the migration from Unix to x86 platforms. That’s a call that the University of Kentucky (UofK) is contemplating because it considers hosting its SAP applications, which currently run on Unix, in private clouds.
“Instantly we run on IBM P Series, and we wish to potentially move to an Intel platform that could be more friendly to certain cloud providers,” said Vince Kellen, UofK’s CIO, in an interview with InformationWeek. “We’d have on-premises processing and a host of off-premises processing, so we need to be capable to run workloads in both locations.”
UofK’s decision to transport from P Series to x86 will depend partially on price, said Kellen. “If IBM involves us with a worth it really is extremely competitive and offers us cloud advantages, then we’ll be all through it.”
It appears IBM could be cutting deals inside the interest of gaining marketshare. IBM was the sole Unix-class server manufacturer one of the top five to report increased unit shipments. IBM’s Q3 shipments rose 19% from from the prior year to fourteen,611 units, but its revenues within the category were off 29.8%, per Gartner.
Looking across all categories of servers, HP maintained its lead among all vendors with modest increases in both shipments and revenues (see Tables 1 and a couple of). IBM suffered the most important drops in unit shipments and revenues. It may not have helped that IBM’s X86 server business was being shopped to Lenovo within the first 1/2 the year. That deal fell through, yet employees and customers of the unit must still have uncertainties in regards to the future.
The best performances within the server market were turned in by vendors which might be new to the market. Cisco reported a 42.7% increase in server revenues and now has 6.1% of the x86 market, up from 4.5% inside the third quarter of 2012. Chinese manufacturer Huawei had a 202% increase in unit shipments over an analogous quarter last year, and it now holds 2.8% of the x86 market. Huawei accounted for under 1% of x86 server shipments inside the third quarter of 2012.
IT groups need data analytics software that’s visual and accessible. Vendors are becoming the message. Also within the State Of Analytics issue of InformationWeek: SAP CEO envisions a younger, greener, cloudier company. (Free registration required.)
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