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Server & Workstations: Surging Ahead
Continued from page: 1

Shrikanth G
Tuesday, July 25, 2006

IBM was able to sell UNIX value proposition also to the SMBs. IBM considers the adoption of UNIX by SMBs as a most promising trend that will pave the way for volumisation of UNIX servers. In other words, SMB customers who were otherwise never buying UNIX have adopted it over the year. Industry experts give two reasons for this. Firstly, the average price of a UNIX server from vendors such as IBM has dropped down considerably. Secondly, low-end applications are now widely available on AIX with the growing needs of an SMB. If we look at HP in the UNIX space, it gained new consumers from the banking and telecom space. 

Non x86 Servers

Vendors

Units
2004-05

Units
2005-06

Sun Microsystems

3,540

4,079

IBM

876

2,051

HP

1,374

1,527

Others

56

54

Total Units

5,846

7,711

Source: IDC India, 2006
With 32% growth in volumes terms, this segment saw rapid escalation of IBM that saw its stature grow in the UNIX space

Meanwhile, if we look at vertical-wise consumption pattern of UNIX servers in terms of applications, verticals such as telecom, absorbed servers for billing and new applications, and BFSI for core banking, manufacturing for business applications and education for high performance computing. 

Blade Servers
Vendors feel the year gone by was great for blades. Blades was just a buzzword few years back. But the aggression shown by players such as HP has led to blades becoming part of the mainstream computing. Segments such as IT and ITeS adopted a good number of blades. The three key drivers that drove the blade market were power, small form and simple management. Blades are finding their way into data centers, which look at lean mean computing environment. The rapid adoption of blades is clearly changing the personality of the servers, and typical candidates for blades are enterprises, which already have more tower servers, and when these enterprises expand, they go in for blades.

From a pure hardware configuration perspective, there is absolutely no difference between a rack server and a blade server. However, as blades have double the density of processors as compared to the 1U rack servers, the amount of heat generated per unit volume is more and hence one might think that the performance would degrade. However, this is not the reality. Clearly, the year went by provided enough pointers that blades are very well poised for a great year ahead. IBM offered its eServer Blade Center that maintains temperature with calibrated vectored cooling-a scientific way to keep temperature of the blades in a range which helps in extracting the best processor performance. 


Typical candidates for blades are enterprises, which already have more tower servers, and when these enterprises expand, they go in for blades

Meanwhile, the year also saw the 64-bit RISC processor-based blade servers entering the market. According to vendors, enterprises are piloting mission-critical applications on them. To start with, RISC blades will be limited to niche areas such as data centers of telecom companies and BFSI. As enterprises complete successful test runs of mission-critical applications on these servers, vendors are expecting RISC blades to enter the mainstream of business computing.

The fear of an operating system getting crashed while running a mission-critical application on a 32-bit platform is widespread. On the other hand, enterprises have been running their critical applications on 64-bit RISC platforms for decades; so 64-bit blades are more acceptable. According to industry experts, chip designing and seismology applications are memory intensive domains that need very high throughput. RISC blades can support such memory-hungry application as well as business applications with similar computing resource requirements such as core banking. 

Sun attacked the blade space aggressively and it recently introduced its new carrier-grade Netra Advanced TCA (ATCA) blade server family, which included the world's first UltraSPARC and AMD Opteron processor-based ATCA blades. Sun Netra ATCA blade server is said to have established a new standard for ATCA blade servers in the industry, offering up to 30% better compute density and up to 10% more performance as compared to competing ATCA blade products.

The Server World: Slow and Steady

According to IDC's Worldwide Quarterly Server Tracker, factory revenue in the worldwide server market declined 1.9% y-o-y to $11.9 bn in the first quarter of 2006. Following ten successive quarters of y-o-y revenue growth, this was the second consecutive quarter of revenue decline. Worldwide server unit shipments growth slowed modestly to 9.5% in first quarter of FY 2006, when compared with the same quarter of 2005. 

Volume server revenue grew 6.3% y-o-y and, although this segment represents the primary growth engine for the overall server market, the first quarter of 2006 experienced the slowest growth in this segment in more than three years. Revenue for mid-range enterprise servers declined 16.2% y-o-y for the second consecutive quarter and the high-end enterprise server market showed a 3.2% decline y-o-y, making this the sixth consecutive quarter of declining revenue for high-end enterprise servers.

The Q1 2006 Global Server Story

Rank

Vendor

 

Q1 2005
Revenue ($ mn)

Market
Share (%)

Q1 2006
Revenue ($ mn)

Market
Share (%)

Revenue
Growth (%)

1

Hewlett-Packard

3,345

27.7

3,335

28.1

-0.3

2

IBM

3,429

28.4

3,304

27.9

-3.6

3

Dell

1,274

10.5

1,321

11.1

3.6

4

Sun Microsystems

1,205

10.0

1,274

10.8

5.8

5

Fujitsu/Fujitsu Siemens

988

8.2

823

6.9

-16.8

 

Others

1,840

15.2

1,796

15.2

-2.4

All Vendors

12,082

100.0

11,852

100.0

-1.9

Server Consolidation
Yet another major trend over the year was the concept of server consolidation gathering further steam. Enterprises looked at optimizing their servers and looked seriously at consolidation and virtualization. Vendors such as Sun looked at server consolidation as a key driver of server sales across traditional verticals. The need to optimize the usage of IT resources within the enterprise prompted large enterprises to consider server and application consolidation solutions. Several large IT spenders in the country, primarily banks, telcos and manufacturing organizations moved up the IT maturity curve very rapidly through consolidating their server infrastructure.

Outlook
India in the last few years has become one of the high growth areas for both x86 and UNIX servers. For the ongoing year, x86 64 bit will gain momentum, while on the other hand, 32 bit will co-exist, as there is customer base for pure 32 bit systems. But with 64 bit back ward compatibility becoming a reality, users now are more comfortable adopting 64 bit systems and in the bargain future proof their server infrastructure. Meanwhile, traditional verticals such as BFSI, telecom and manufacturing will continue to drive the UNIX market. But vendors will also be aggressive on other verticals such as airlines, steel, logistics and textiles for UNIX. Blades will further gain traction during 2006-07, and hosted environments such as data centers will ramp up their computing power by opting for blades rather that going for conventional servers. The increasing affordability factor in all forms of servers also indicate that organizations will empower themselves by going for mix and match of server technologies as per their unique requirements. In all, servers are expected to continue their buoyancy in India during the year.

Shrikanth G
shrikanthg@cybermedia.co.in

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