India x86 server market drops in Q2, HPE retains top position


X86 Server market in India declined by 16.9 percent quarter-on-quarter in Q2 2016, latest data from IDC showed.

The number of units shipped was 33,662 in the second quarter as against 40,488 units in Q1 2016.

During the same period, server revenue dropped 16.5 percent.

The research firm said periodic investments from cloud service providers, home-grown hosting providers and continued spending towards 4G deployments predominantly contributed to this quarter’s server demand.

Digitization across the banking sector, piece-meal demand from e-commerce and payment banks further fuelled into Q2’s compute demand.

Overall spending on server has normalized back to its usual average, and the trend is expected to continue in the coming quarter as well.

HPE maintained its leading position in Q2 with 34 percent market share in terms of unit shipment. Dell is in the second position with a market share of 25 percent. At the same time, Lenovo’s market share dropped further.

On the revenue front, HPE continued to lead with 37 percent market share, followed by Dell at 27 percent. Cisco’s market share stood at 12 percent, closely followed by Lenovo at 10 percent.

Non x86 server market

The non x86 server market declined by 25.2 percent quarter-on-quarter in terms of unit shipments and 3.7 percent in terms of revenue in Q2.

According to IDC, communications & media and banking verticals continued to be the major contributors to this market.

Internet banking initiatives, cyclic banking refreshes and continued investments from telecom providers majorly contributed to this demand.

Ruchika Kakkar, Server Market Analyst, IDC India, said: “Although there’s an evident slowdown in the server market, further investments towards 4G deployments, and expansions in the cloud and local data-centre space continue to remain in the pipeline. Realization of the GST bill and on-going consolidations in the banking and e-commerce space are also expected to proliferate server demand from early next year.”

IDC forecasts that government backed Smart City Projects and Digital India drive are expected to draw sizeable compute demand through the next few quarters.

Ongoing banking refreshes and digitization initiatives are expected to propel server demand across most verticals including Professional services, Banking, Education and Manufacturing, the firm added.