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27 Mar 2018

India Server Market registers record high Y/Y Revenue growth of 92.4% in Q4 2017

NEW DELHI, March 27th, 2018 - The overall server market in India witnessed a year-over-year (YOY) increase of 92.4 percent in terms of revenue to reach $371.4 million in Q4 2017 versus $193.1 million in Q4 2016, according to the latest IDC Asia Pacific excluding Japan (APEJ) Quarterly Server Tracker, Q4 2017. The x86 server market accounted for 86.7 percent of the overall server revenue during Q4 2017, with growth being majorly driven by spending from professional services, Government, telcos, and banks.

The Q4 2017 quarter has been record breaking for both non-x86 and x86 server product categories. Non-x86 platform remains at the top of mind for many end-users looking for data workloads such as databases, data warehouses, transaction processing, and high-performance computing. Banks are the primary buyers in this category and high availability with minimum downtime, maximum uptime are key considerations.

The non x86 server market grew by 115.6 percent YOY in terms of revenue to reach $49.6 million in Q4 2017. In terms of revenue, IBM leads the market, accounting for 47.8 percent of market share, followed closely by HPE with its share of 44.7 percent during Q4 2017. In non x86 server market, banking industry continues to dominate and accounts for 55.9 percent of the revenue, followed by Government with 21.1 percent and manufacturing with 7.4 percent.

The x86 server market in terms of revenue witnessed a YOY growth of 89.3 percent to reach $321.9 million in Q4 2017 up from $170.1 million during Q4 2016. The growth was majorly driven by professional services, government, banking and telecommunications, while manufacturing continues to witness growth for the straight third quarter. Blade and rack optimized servers together accounted for 75.1 percent of the overall x86 server market by revenues during Q4 2017. In the x86 product category, 99.7 percent were Intel-based processors sold in the volume, mid-range and small server segment.

“The phenomenal growth in the Server markets adds a lot of available computing power for consumption that will be leveraged by organizations to venture deeply into the Digitized world. The overall units deployed across x86 and non- x86 grew by greater than 1.8 times YoY in the areas of Professional services, Manufacturing, Government and BFSI contributed for more than 89.1 percent of the overall server market by units, shipped during Q4 2017. The Indian Server market will see the impact of Digital initiatives, datacenter expansion and ODMs penetration” adds Ranganath Sadasiva, Director, Enterprise Research, IDC India.

Vendor Highlights:

Source: IDC APeJ Quarterly Server Tracker, Q4 2017

In India x86 market, HPE leads the India server market with 32.8 percent in Q4 2017. The major deals for HPE came from telecommunications and professional services verticals. Dell successfully increased its market share to 19.4 percent during Q4 2017, while Cisco accounted for 6.6 percent of market share winning deals across different verticals. Cray successfully closed the deal with central government on supercomputer project and grabbed the market share of 9.3 percent where as ODM direct market share declined to 21.2 percent in Q4 2017.

Traditional three tier architectures are still at the mainstream of India enterprise infra market. We have seen professional services, and telcos as early adopters and innovators towards adoption of virtualization and using HCI approach for their DC strategy. New age workloads such as IoT, big data analytics, and AI are still at a nascent stage and requires significant efforts from vendors and OEM eco-system towards educating the end-users and its business outcomes.,” says Harshal Udatewar, Server Market Analyst, IDC India.

IDC India Forecast

Political and economic conditions remained stable with strong outlook expected due to the progress in GDP. Government impetus would be more towards creating better citizen services and spending would continue to grow towards digitalization throughout 2018. Technologies such as Cloud, mobility, social media and analytics are slowly picking pace amongst large enterprise end-users and is expected to benefit the server market. End-users from manufacturing verticals were seen to be focussed on automating their workplaces towards achieving better operational efficiencies and is expected to fuel the growth of server market in India.

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