In addition to India, Inventec is also planning to establish plants in Southeast Asia and Japan for server production, mainly to serve its clients’ demand, according to company chairman Richard Lee. Inventec’s main server clients are Hewlett-Packard (HP) and Dell, bu the ODM has seen the majority of server orders come from HP, which has made aggressive moves in the server market.
Servers shipped in the Taiwan market in 2014 were worth NT$11.11 billion (US$352 million), growing 18.3% on year. NT$8.88 billion or 79.9% was due to brand vendors and NT$2.23 billion or 20.1% to direct-sale white-box ODMs, according to IDC Taiwan. Shipment value for volume (entry-level) servers increased 28.6% on year and accounted for 83.7% of total shipment value. Mid-range enterprise servers slipped 36% and took up 5.8%, and high-end enterprise models grew 1.5% and accounted for 10.5%.
Apple has joined the Facebook-established Open Compute Project in line with its plans to set up new cloud data centers and replace servers used in existing data centers. Some Taiwan-based white-box server makers have obtained orders from Apple and will begin shipments soon, according to Taiwan-based supply chain makers.
The much anticipated infrastructure refresh cycles and the new greenfield projects, which the government is planning to launch soon, will be the major drivers of growth for India’s storage and servers market. The server and storage vendors have their eyes set on the programmes such as ‘Digital India’ and ‘Make in India’, both of which are expected to lead to the rise of a large number of greenfield projects.
GIGABYTE and Applied Micro Circuits Corporation (NASDAQ: AMCC) today announced the commercial availability of GIGABYTE’s MP30 server platform. Powered by AppliedMicro’s X-Gene Server on a Chip solution, the MP30 platform offers customers compelling performance-per-watt capability. The MP30 platform enables its users to optimize server hardware for specific workloads, thereby improving performance and value and reducing total cost of ownership.
Demand from emerging markets such as Russia and China for white-box servers directly supplied from ODMs has been increasing, pushing related ODMs to accelerate their paces on establishing full product lineups, according to sources from the upstream supply chain. Because of the US government’s PRISM surveillance program, many Internet players in emerging markets are planning to establish in-house datacenters, boosting demand for datacenter hardware and bringing new business opportunities to Taiwan-based white-box server ODMs, the sources said.
Mitac Computing Technology, a cloud computing affiliate of the Mitac Group, is expected to achieve a double-digit percentage growth on year in 2015. In addition to increased cooperation with system integrator clients, the company also sees its server and storage OEM business growing, according to sources from the upstream supply chain.
In the fourth quarter of 2014, worldwide server shipments increased 4.8% on year, while revenues grew 2.2% from the fourth quarter of 2013, according to Gartner. In all of 2014, worldwide server shipments grew 2.2%, and server revenues increased 0.8%. “There were several factors that produced the strong growth in the server market in 2014,” said Jeffrey Hewitt, research vice president at Gartner.
Hewlett-Packard (HP) recently announced cooperation with Taiwan-based Accton Technology to sell switches matched with software developed by Silicon Valley-based Cumulus Networks. The agreement is expected to increase the reliability of white-box data center servers produced by Taiwan-based makers, according to Taiwan-based supply chain makers.
Notebook ODM Quanta Computer has been competing for server ODM orders from Dell, according to industry sources. Quanta Computer was originally a server ODM for Dell and NEC but has shifted the focus of its server business from ODM to white-box production for direct shipments to clients setting up cloud computing data centers including Google, Facebook, Amazon and Microsoft.
Taiwan-based notebook ODM Quanta Computer, in view of large potential demand for servers used in cloud computing data centers in Europe and North America, will set up a server factory in Germany, while Wiwynn, ODM Wistron’s subsidiary specifically responsible for producing and marketing servers, will do so in Mexico and Czech, according to Taiwan-based supply chain makers.
Taiwan-based notebook ODM Quanta Computer and Wiwynn, Taiwan-based ODM Wistron’s subsidiary specifically responsible for direct-account (white-box) sale of servers, are expected to see direct-account shipments of servers in 2015 significantly increase on year mainly due to fast growing demand for use in Internet data centers, according to Taiwan-based supply chain makers.
Dell Korea said Wednesday it will continue double-digit growth in the server business year amid a slowdown in the global market. “We recorded double-digit growth last year despite the report by global market researcher International Data Corporation (IDC) that the server market size has decreased compared to the previous year,” said Dell Korea Vice President Kim Sung-joon during a press conference at the Dell Server Solution Seminar 2015 at the COEX Intercontinental Hotel in Samseong-dong, southern Seoul, Wednesday.
Since server products have longer product life cycles than PCs and smartphones, global server shipments have been hovering around 10 million units a year for some time. However, the industry is set for more volatile changes in 2015 following the establishment of a server joint venture by Hewlett-Packard (HP) and Foxconn Electronics in May 2014. The non-equity joint venture means that the cooperation between HP and Foxconn is more like a contractual relationship, rather than ownership sharing, and that the joint venture aims to optimize resources available at the two companies to enhance competitiveness in the server segment.
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.”