India x86 server market grows by 21.6 percent in Q1 2016: IDC India


Jul 20, 2016

20 Jul 2016: According to International Data Corporation (IDC), server market in India rose by 21.6 percent year-on-year in Q1 2016, with 40,495 units shipped in Q1 2016 as against 33,292 units in Q1 2015. In terms of revenue, there was a 27.8 percent year on year growth registered in Q1 2016.

Continued investments from telecom service providers towards 4G deployments, piece-meal investments from local hosting providers and periodic banking refreshes primarily contributed to the national compute demand in Q1 2016. The onset of digitization drives across multiple verticals and cities further drove server demand this quarter. Multiple ongoing smart cities initiatives and surveillance projects further propelled compute demand nationwide.

The non x86 server market grew by 15.3 percent year on year in terms of unit shipments and 42.4 percent in terms of revenue in Q1 2016. Banking and Communications & Media verticals were the major contributors to this growth, owing to several bank refreshes and continued investments from telecom providers.

According to Ruchika Kakkar , Server Market Analyst, IDC India, “Last few quarters have witnessed predominant compute demand from telecom providers for 4G deployments, e-commerce investments and local datacentre expansions. With the launch of AWS data centres in India, the cloud services space in India is expected to get more competitive, price cuts more dramatic and compute demand more imperative."

According to Gaurav Sharma , Research Manager, Research Manager- Enterprise & IPDS, IDC India, "Digital initiatives, consolidation projects, refresh and upgrades and growing need for compute due to 3rd platform deployments are all in line to drive demand in the coming quarters.”

Figure 1

Major Vendors

In India x86 market, HP maintained its leading position in Q1 2016 with 40 percent market share in terms of unit shipment, followed by Dell with a market share of 25 percent. Lenovo’s market share dropped from 18 percent to 12 percent year-on year. White box providers lost marginal market share of 1 percent on a comparative basis, down from 12 percent in Q1 2015 to 11 percent in Q1 2016; however, they witnessed 16.4 percent year-on-year growth in Q1 2016, in terms of absolute unit shipment. Cisco’s market share dropped by 1 percent year-on year, while Acer retained its market share at 3 percent.

On the revenue front, HP led with 46 percent market share, followed by Dell at 27 percent market share. Lenovo’s market share stood at 8 percent in Q1 2016, closely followed by Cisco at 7 percent.

IDC India Forecast

Investments from global cloud service providers and a few e-commerce players is expected to drive notable compute demand in the next two quarters. On-going banking refreshes and digitization across various verticals are expected to augment server demand further. Government backed surveillance and ‘Digital India’ projects across multiple states remain in the pipeline, with further investments expected in the near future.

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