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Public cloud adoption fuels record spend on datacentre hardware by service providers

Datacentre infrastructure findings from Synergy Research show how enterprise cloud adoption is affecting the market

Growing demand for public cloud services has resulted in a record amount of money being spent on service provider datacentre hardware during the third quarter of 2015, research shows.

According to Synergy Research Group’s quarterly Datacentre Infrastructure Market Leaders data, sales of service provider datacentre hardware surged worldwide in Q3, with Cisco, Hewlett-Packard Enterprise (HPE) and Dell reaping the benefits.

Despite this growth spurt, the service provider datacentre hardware sector makes up a relatively small proportion of the overall infrastructure market tracked by Synergy, and is dwarfed by the larger, but slower growing, enterprise datacentre segment.

Sales of enterprise datacentre hardware make up more than half of the overall datacentre infrastructure market, said Synergy, with HPE’s kit emerging as the most popular with a 24% share.

Synergy’s data also tracks players in the datacentre software market, and shows Microsoft is by far the market leader, with a share of just under 70%.

Its nearest rival, VMware, has less than 20% of the market.

The market watcher’s datacentre infrastructure research aims to track sales of servers, storage, networking and security products, as well as operating system and virtualisation software, used in both private enterprise and service provider-run facilities.

Read more about datacentre spending trends

The overall amount spent in these areas hit $29bn worldwide in Q3, up 3% on the previous year, with most of the growth coming from the service provider segment, which chalked up year-on-year growth of more than 20%.      

In terms of individual product types, sales of rack servers accounted for 34% of the total datacentre infrastructure spend in Q3, while virtualisation software, blade servers and integrated security platforms were also highlighted by Synergy as popular hardware investment areas.

Jeremy Duke, Synergy Research Group’s founder and chief analyst, said the market’s Q3 performance should ensure annual spending on datacentre infrastructure equipment nears $120bn before the end of the year.

“The mass adoption of public cloud services has created the need for widespread deployment of hyperscale datacentres and has led to record spending on service provider datacentre equipment,” he said.

“While the market dynamics are different for private cloud, it too will drive enormous changes in the investment patterns for enterprise datacentre hardware, software and services.”



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