March 3, 2015
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IBM and HP slipped while Cisco and Lenovo gained share in the worldwide server market in 2014. That's the upshot of Gartner's fourth-quarter and full-year report on server shipments, revenues, and market share shifts in 2014, which was released Tuesday.
The shifts at two of these firms were fueled by IBM's late September sale of its x86 server business to Lenovo for $2.3 billion. That deal helped fuel Lenovo's 112.3% increase in unit shipments, though the company still doesn't rank among the top-five vendors overall (with $1.5 billion in revenue), since it doesn't participate in the lucrative, high-end RISC/Itanium server market.
Even without the sale of its x86 business, IBM's server revenue sank 14% from fourth quarter 2013 results, capping an off year for IBM's mainframe and Power server lines. IBM's server revenues across all categories were off 27.1%, while unit shipments declined 37.8% from 2013 full-year results. IBM's next-generation z13 server, released in January, is expected to revive mainframe revenues.
[ Want more on this topic? Read IBM Mainframe Makeover: Mobile, Big Data Reality Check. ]
HP remains the server market leader, but it suffered a 9.4% decline in unit shipments for the year. Revenues held steady at $13.3 billion, up 0.4%. HP's biggest declines were in the RISC/Itanium market, with unit shipments off 18.8% and revenues down 21.8%.
Oracle posted the only positive number in the RISC (Unix and Linux) segment, with a 4.7% increase in unit shipments, but it, too, saw revenues decline, albeit with a 2.3-point gain in market share.
The biggest growth story of the year (not counting Lenovo's big acquisition) was Cisco's 29.8% increase in server revenue, to $2.9 billion. Driving that growth is Cisco's Unified Computing System (UCS) line, which integrates servers, storage, networking, and even virtualization software in preconfigured systems that are ready to run and to consolidate data center workloads.
Cisco's success with UCS hasn't gone unnoticed, with Oracle recently introducing the Oracle Virtual Compute Appliance as a head-to-head UCS competitor. The appliance, which joins Oracle's line of Engineered Systems combining hardware and software, is one more example of an integrated system.
"The growth of integrated systems, while still relatively small as an overall percentage of the hardware infrastructure market, provided some growth contribution to the x86 server space for the year," wrote Jeffrey Hewitt, a research VP, in the Gartner report. Hewitt described 2014 as a "moderate growth year" with overall increases of 2.2% in shipments and 0.8% in revenue.
"x86 servers continue to be the predominant platform used for large-scale data center buildouts across the globe," Hewitt wrote.
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