Enterprise Storage Systems Market Share

Updated: 27 March 2023

Worldwide Enterprise External OEM Storage Systems Market Spending Expected to Cool Down in 2023 and Grow 2.9% over a 5-year period, According to IDC

2022 was one of the strongest years for the external enterprise storage systems (ESS) market. In 4Q, vendor revenue grew 7.6% and for the full year it observed 7.2% growth. However, while still being strong, Q4 slowed down compared to the previous quarters. The same dynamic was observed for internal OEM and ODM Direct storage segments, for which y/y growth rates slowed down respectively to 12.9% and 20.2%.

Some of the factors which drove strong market growth throughout 2022 include shipments for backlogged orders accumulated during previous quarters; prioritization of mission-critical workloads which often require higher-end, performance-oriented systems, which cannot be replaced with less expensive alternatives; and lastly raising inflation and energy prices that drives higher demand for energy efficient systems, which is also expected to be a longer-term trend across all regions.

These market dynamics will extend their impact on market performance into 2023 while the major impact is expected from the overall economic slowdown. GDP forecasts have been systematically downgraded throughout the past year. While IDC believes the ESS market is more resilient than in the past, slower growth means smaller revenues and ultimately some budget cuts that will impact CAPEX spending on storage systems. Global labor markets are still relatively healthy as of early 2023, however, an increase in layoffs may be signaling increased impact of economic slowdown, which could also lead to IT budget cuts.

The war between Russia and Ukraine continues impacting the market in both direct and indirect ways. In the most direct way, system sales in Russia and Ukraine have practically stopped, and indirectly, the war added to already growing energy prices and transportation costs, which have a rippling impact on the IT industry, especially on regions which historically relied more on energy resources from Russia. Cutting energy supply worsens the already declining consumer and business confidence and recessionary pressures.

In the longer-term, continuous investments on infrastructure modernization, fast-growing workloads, and support of the overall growth of digital data will be sustainable factors for the overall market growth, although the external ESS market will continue to be threatened by server-based solutions.

Worldwide ESS External OEM Market Forecast 2022 - 2027 Value (US$M)

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