The worldwide integrated infrastructure and platforms market increased revenues by 28.1% on year to US$2.3 billion during the third quarter of 2014, according to the IDC. The market generated more than 898PB (petabytes) of new storage capacity shipments during the quarter, which was up 46.6% compared to same period a year ago.
Wistron’s white-box server subsidiary Wiwynn and Quanta Computer are expected to achieve their server business goals for 2014, but in anticipation of growing competition in the server market in 2015, the two players have already stepped up efforts looking to expand their shipments, according to sources from the upstream supply chain.
With the server market’s rapid growth and the China government’s aggressive efforts to build up the country’s server industry, China-based server brand vendors have all seen their annual shipment growths surpassing 50% in the past few years. As Lenovo completed the acquisition of IBM’s server business in September of 2014, Digitimes Research expects the strong growth to continue in 2015.
Server hardware shipments in the Chinese market increased by 15.63% year-on-year, according to latest data from Gartner. Market research firm Gartner recently published a report on the server market for the third quarter of 2014 which showed the global server shipment increased by 1% year-on-year to 2.53 million units, showing weak growth. Among various regional markets, only China maintained a high growth rate of 15.63% and the total shipments reached 498,000 units.
As large retail chains including Walmart, Best Buy and Target plan to set up data centers to operate e-commerce, server makers Quanta Computer and Wiwynn are looking to land orders based on their lower prices compared to brand vendors’ quotes, according to industry sources. The sources pointed out that the retail chains have all been aggressively expanding their e-commerce business coverage, especially Walmart, which is seeing its sales from the e-commerce segment grow rapidly and is gradually becoming a threat to Amazon.
In the third quarter of 2014, worldwide server shipments grew 1% on year, while revenues moved upward 1.7% from the third quarter of 2013, according to Gartner. “The third quarter of 2014 produced modest growth on a global level, highlighting positive but constrained demand,” said Errol Rasit, research director at Gartner. “Only North America and Asia Pacific exhibited shipments growth, largely driven by demand from hyperscale organizations located there. These results support the continued bifurcation of enterprise and consumer services server demand.”
Seeing Lenovo’s acquisition of IBM’s x86 server business and competition in the server industry growing fierce, China-based server player Inspur is also aggressively seeking acquisition targets and expects to achieve some results in 2015, according to a Chinese-language National Business Daily report citing company chairman Sun Pishu.
Taiwan-based server ODMs have been aggressively expanding their services worldwide. Quanta Computer’s server centers in Japan, and in China’s Hangzhou and Beijing have recently started operating, while its office in Germany will also begin operation by the end of 2014. Inventec is also set to establish a cloud computing server center in Europe to better serve its clients in the region.
Despite aggressively attempting to advance into the PC and server industries, ARM-based CPU platforms will not be able to achieve any significant results within the next two years in the two segments; however ARM and Intel have found a new business opportunities in the Internet of things (IoT) segment and both expect growth in that area, according to sources from the supply chain.
Qualcomm wants to enter the server market, but it won’t do it alone, and will tap expertise in China to build the low-power chips. “We’re going to work with Chinese companies to bring that technology and in fact co-develop that technology with Chinese companies,” said Qualcomm executive chairman Paul Jacobs on Thursday. Jacobs made the comment while speaking at the World Internet Conference in Wuzhen, China. Qualcomm is best known as a maker of smartphone processors based on chip architecture from ARM Holdings, but the company wants to take a crack at the server market, which rival Intel has long dominated.
As users of white-box servers (produced by ODMs and sold directly to clients) mostly need a large number of small-size, low-power and inexpensive models pre-installed with Linux and customized to some extent, white-box servers are mostly rack or micro types instead of towers or blades. The users usually have in-house technical teams to handle their servers’ maintenance and find server brand vendors’ designs limiting their operations; therefore, they have turned to supplies directly from ODMs.
Quanta Computer reportedly has received new orders from Google for servers recently and will start supplying in the first quarter of 2015, according to industry sources. Quanta declined to comment on its orders. Quanta had been the sole server supplier for Google’s databank center before the search engine company switched about 80% of its orders to Inventec in the second half of 2014. Quanta’s new server orders are likely to account for 50% of Google’s total purchases of servers in early 2015, the sources estimated.
A Chinese company has developed the country’s first homegrown servers, built entirely out of domestic technologies including a processor from local chip maker Loongson Technology. China’s Dawning Information Industry, also known as Sugon, has developed a series of four servers using the Loongson 3B processor, the country’s state-run Xinhua News Agency reported Thursday. “Servers are crucial applications in a country’s politics, economy, and information security. We must fully master all these technologies,” Dawning’s vice president Sha Chaoqun was quoted as saying.
Good day, ladies and gentlemen. Thank you for standing by. Welcome to the Super Micro Computer, Incorporated first quarter 2015 conference call. The company’s news release, issued earlier today, is available from its website at http://www.supermicro.com. In addition, during today’s call, the company will refer to a slide presentation that has been made available to participants, which can be accessed in a downloadable PDF format on its website at http://www.supermicro.com in the Investor Relations section under the Events & Presentations tab.
Lenovo has become the biggest x86 server provider in China as its acquisition of IBM’s x86 server business completes. IDC said it believes this acquisition will enrich Lenovo’s x86 server portfolio and strengthen its products and channels. IDC’s latest data on China x86 server market shows, Lenovo shipped 99,101 units in the first half of 2014 and ranked fourth among all vendors in the same category. Combining IBM and Lenovo’s shipments in the period would make Lenovo the biggest vendor in China’s x86 server market with a market share of 23.9%.
To compete for more datacenter server orders, Quanta Computer reportedly will establish a service center in Europe in October, helping its server business to cross North America, Asia and Europe, according to sources from the upstream supply chain. Other Taiwan-based makers such as Wistron, Inventec, Foxconn Electronics (Hon Hai Precision Industry) and Mitac will also strengthen their competitiveness through improving software and services.
China’s X86 server shipments reached 448,000 units, a year-on-year increase of 22.2%; and its server sales reached USD1.43 billion, a year-on-year increase of 34.6%, according to latest statistics from IDC. Statistics from IDC showed that during the second quarter of 2014, the global shipment of X86 servers increased by 1.5% year-on-year to 2.2 million units; while the related sales increased by 7.8% year-on-year to USD9.8 billion.
BEIJING: IBM will help China’s largest server vendor Inspur International design server systems, the two companies said on Friday, an unexpected development in what has been a politically charged rivalry in the Chinese technology market. Since last year Inspur has aggressively marketed its servers to Chinese state-owned firms as a replacement for IBM (International Business Machines Corp) systems while US-China relations have worsened dramatically over mutual suspicions of cyberspying.
While the server market has been growing at a flat rate for several quarters the world over, India and the Asia Pacific region are the only markets showing promise. Market leader HP is betting on India for better prospects in the segment, a top company official said. Growing popularity of cloud computing, virtualisation and big data is boosting the server market in India, where blade servers and micro servers have been major growth drivers.
Quanta Computer has announced revenues of NT$77.93 billion (US$2.6 billion) for July, up 8.53% on month and 8.63% on year with combined revenues for the first seven months of 2014 reaching NT$508.27 billion, up 10.48% on year. Quanta shipped 4.2 million notebooks in July, down from 4.3 million units in June. Despite having a notebook shipment drop, the company still managed to achieve a revenue growth in July mainly thanks to a better product mix and contributions from non-notebook product lines, estimated some market watchers, adding that Apple’s increased orders for Mac series products also benefited Quanta’s revenues recently.