IDC Expects Demand for Systems in Worldwide Server Market to Produce 5% Growth in 2004
FRAMINGHAM, Mass., June 16, 2004 The resurgence in demand for enterprise server solutions that began late last year is expected to continue throughout 2004, expanding worldwide spending for servers by 5% to $53 billion. IDC forecasts the server market will achieve a compound annual growth rate (CAGR) of 3.8% over the next five years, representing a $60.8 billion opportunity in 2008.
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"A good environment for hardware and software replacement and migration is helping fuel new enterprise spending for IT infrastructure" said Steve Josselyn, research director for IDC's Global Enterprise Server Solutions program. "We anticipate growing demand in emerging markets, such as Eastern Europe and Asia, as well as mature markets like the U.S. and Western Europe."
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- In 2004, IDC found that 52.5% of respondents to a survey it conducted stated that the main driver for the demand of more data storage is the increased use of email.
- IDC also found that 13.5 trillion total emails were transmitted in 2003. This figure is expected to rise to 19.7 trillion in 2005.
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While vendors continue to compete very aggressively on price for these customer dollars, demand has driven the number of servers sold above the 20% year-on-year growth mark for the past three quarters. "There continues to be very strong growth in the x86 industry standard server market particularly for Windows and Linux-based solutions", said Mark Melenovsky, director of Global Enterprise Server Solutions research. "Growth has been strong for everything from stand-alone systems in small offices to several hundred node clusters in enterprise data centers."
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From a regional perspective, the U.S. will continue to hold the greatest share of the worldwide server market through the end of the forecast period, followed by Western Europe and Asia/Pacific (excluding Japan). IDC expects the strongest growth over the next five years to be in Central and Eastern Europe, as well as the Asia/Pacific region, which are both expected to witness a CAGR in excess of 6.5%.
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In terms of products, a key growth area will be the blade server market, which is expected to reach $9 billion by 2008. Server blades will represent nearly 29% of server unit shipments by the end of the five year forecast period. IDC believes the blade or modular computing market is a new area of opportunity for server vendors and will bring dramatic changes to the server landscape while creating new areas of demand for server management, virtualization, network equipment and clustering.
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Servers based on the Linux operating system will have comparable market share numbers in 2008, representing approximately 29% of all server unit shipments and about $9.7 billion in revenues. Microsoft Windows-based servers are expected to capture 60% of all server unit shipments in 2008 and represent the largest server operating environment in terms of revenues with $22.7 billion. IDC anticipates Windows and Linux servers combined to more than 50% of server market revenues in 2008 up from just 37% in 2003.
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IDC's Worldwide Quarterly Server Forecast is a quantitative tool for analyzing the future global server market on a quarterly basis. The forecast includes quarterly shipments (both ISS and upgrades) and customer revenues segmented by region, operating system, price band, CPU type, form factor, and CPU capacity.
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For more product information, please contact Hoang Nguyen at 508-935-4718 or hnguyen@idc.com or Steve Josselyn at 508-935-4247 or sjosselyn@idc.com.
