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29 Mar 2018

Public Cloud Expansion Drives Double-Digit Growth of Worldwide Cloud IT Infrastructure Revenues in the Fourth Quarter of 2017, According to IDC

FRAMINGHAM, Mass., March 29, 2018 – According to the International Data Corporation (IDC) Worldwide Quarterly Cloud IT Infrastructure Tracker, vendor revenue from sales of infrastructure products (server, storage, and Ethernet switch) for cloud IT, including public and private cloud, grew 27.3% year over year in the fourth quarter of 2017 (4Q17), reaching $12.8 billion. For the full year 2017, the combined public and private cloud deployments continued the double-digit annual growth trend from past years with revenues reaching $43.4 billion for 21.7% year-over-year growth.

Public cloud infrastructure revenue has almost doubled in the past two years to $8.5 billion, growing 34.0% year over year in 4Q17. Private cloud revenue reached $4.3 billion for an annual increase of 15.7%. Total worldwide cloud IT infrastructure revenue in 2017 more than doubled when compared to 2013. The combined public and private cloud revenues now represent 42.2% of the total worldwide IT infrastructure spending, up from 39.3% a year ago. Traditional (non-cloud) IT infrastructure revenue grew 12.8% from a year ago, although it has been generally declining over the past several years; at $17.5 billion in 4Q17 it still represents 57.8% of total worldwide IT infrastructure spending.

"2017 finished strong for public cloud IT infrastructure growth, led by continued expansion by Amazon and renewed growth in Google and Facebook infrastructure," said Kuba Stolarski, research director for Computing Platforms at IDC. "While there has been high growth in all IT infrastructure segments lately, public cloud, led by the hyperscalers, has resulted in the largest share of infrastructure growth, which is expected to continue at this pace for at least a few more quarters."

Except for Latin America and Japan revenue, which grew 6.2% and 4.8% respectively from a year ago, all other regions in the world grew their cloud IT Infrastructure revenue by double digits. Asia/Pacific (excluding Japan) and Central and Eastern Europe (CEE) saw the fastest growth rates at 59.0% and 34.1%, respectively. Canada (23.3%), Middle East & Africa (MEA) (27.5%) and USA (21.1%) had annual growth in the twenties, while Western Europe (16.6%) had annual growth in the teens.

Top Companies, Worldwide Cloud IT Infrastructure Vendor Revenue, Market Share, and Year-Over-Year Growth, Q4 2017 (Revenues are in Millions)

Company

4Q17 Revenue (US$M)

4Q17 Market Share

4Q16 Revenue (US$M)

4Q16 Market Share

4Q17/4Q16 Revenue Growth

1. Dell Inc

$1,887

14.7%

$1,466

14.6%

28.7%

2. HPE/New H3C Group**

$1,544

12.1%

$1,414

14.1%

9.2%

3. Cisco

$1,020

8.0%

$952

9.5%

7.1%

4. Huawei*

$560

4.4%

$417

4.1%

34.4%

4. IBM*

$518

4.0%

$328

3.3%

58.1%

ODM Direct

$4,176

32.6%

$2,853

28.4%

46.4%

Others

$3,096

24.2%

$2,629

26.1%

17.8%

Total

$12,801

100.0%

$10,058

100.0%

27.3%

IDC's Quarterly Cloud IT Infrastructure Tracker, Q4 2017 March 2018

Notes:

*     IDC declares a statistical tie in the worldwide cloud IT infrastructure market when there is a difference of one percent or less in the vendor revenue shares among two or more vendors.

**     Due to the existing joint venture between HPE and the New H3C Group, IDC will be reporting external market share on a global level for HPE as "HPE/New H3C Group" starting from Q2 2016 and going forward.

IDC's Worldwide Quarterly Cloud IT Infrastructure Tracker is designed to provide clients with a better understanding of what portion of the server, disk storage systems, and networking hardware markets are being deployed in cloud environments. This tracker breaks out each vendors' revenue by the hardware technology market into public and private cloud environments for historical data and provides a five-year forecast by the technology market.

Taxonomy Notes:

IDC defines cloud services more formally through a checklist of key attributes that an offering must manifest to end users of the service. Public cloud services are shared among unrelated enterprises and consumers; open to a largely unrestricted universe of potential users; and designed for a market, not a single enterprise. The public cloud market includes variety of services designed to extend or, in some cases, replace IT infrastructure deployed in corporate datacenters. It also includes content services delivered by a group of suppliers IDC calls Value Added Content Providers (VACP). Private cloud services are shared within a single enterprise or an extended enterprise with restrictions on access and level of resource dedication and defined/controlled by the enterprise (and beyond the control available in public cloud offerings); can be onsite or offsite; and can be managed by a third-party or in-house staff. In private cloud that is managed by in-house staff, "vendors (cloud service providers)" are equivalent to the IT departments/shared service departments within enterprises/groups. In this utilization model, where standardized services are jointly used within the enterprise/group, business departments, offices, and employees are the "service users."

IDC defines Compute Platforms as compute intensive servers. Storage Platforms includes storage intensive servers as well as external storage and storage expansion (JBOD) systems. Storage intensive servers are defined based on high storage media density. Servers with low storage density are defined as compute intensive systems. Storage Platforms does not include internal storage media from compute intensive servers. There is no overlap in revenue between Compute Platforms and Storage Platforms, in contrast with IDC’s Server Tracker and Enterprise Storage Systems Tracker, which include overlaps in portions of revenue associated with server-based storage.

For more information about IDC's Quarterly Cloud IT Infrastructure Tracker, please contact Lidice Fernandez at 305-351-3057 or lfernandez@idc.com.

About IDC Trackers

IDC Tracker products provide accurate and timely market size, vendor share, and forecasts for hundreds of technology markets from more than 100 countries around the globe. Using proprietary tools and research processes, IDC's Trackers are updated on a semiannual, quarterly, and monthly basis. Tracker results are delivered to clients in user-friendly excel deliverables and on-line query tools.

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly-owned subsidiary of International Data Group (IDG), the world's leading media, data and marketing services company that activates and engages the most influential technology buyers. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC and LinkedIn.

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Coverage

Contact
For more information, contact:

Kuba Stolarski
kstolarski@idc.com
508-935-4172

Lidice Fernandez
lfernandez@idc.com
305-351-3057

Michael Shirer
press@idc.com
508-935-4200