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LONDON, Oct. 21, 2020 /PRNewswire=KYODO JBN/ --

The global server market recorded the strongest second quarter on record in

terms of shipments. A total of 3.4 million servers shipped in the second

quarter of 2020, up 39 percent year-over-year. According to Omdia's latest Data

Center Server Equipment Market Tracker [https://omdia.tech.informa.com/OM006920/Data-Center-Server-Equipment-Market-Tracker---Q2-2020 ].

The increase in server shipments is a result of an increased reliance on cloud

services for both consumers and enterprises. Consumers are continuing to rely

on cloud services for entertainment, social interaction, and learning while in lockdown.

Enterprises also continued their increased reliance on cloud services as many

continue to keep their offices closed due to the global pandemic, resulting in

increased demand for services such as virtual desktop infrastructure (VDI) in

aid of remote working.

Manoj Sukumaran, senior analyst for data center compute, at Omdia, commented:

"In the second quarter there was a strong demand for servers from Tier 2 cloud

service providers (CSPs) and Communication Service Providers (Comm SPs).

"For many enterprises, migrating to cloud services was a cost saving measure

used to offset lower revenues due to Covid-19, avoiding data center IT capital

expenditures (CapEx). The increasing consumption of streaming media services

like Netflix, YouTube, Hulu etc. and the use of higher quality media content

has created a need for expanding content delivery networks driving server

demand from Comm SPs."

Omdia's Data Center Server Equipment Market Tracker [https://omdia.tech.informa.com/OM006920/Data-Center-Server-Equipment-Market-Tracker---Q2-2020 ]

also found an increase of the average selling prices (ASPs) of servers and

attributed it to two factors. First, a larger number of servers were shipped to

Tier 2 CSPs and Comm SPs which carry a higher ASP, and the volume low-cost

servers shipped to hyperscale cloud service provider decreased. Second, there

was an increase in the price of components, including memory and flash storage.

As a result, server revenue followed unit growth and was up 18 percent year-over-year.

The 2020 outlook

Omdia has updated its server revenue forecast, baking in the increased demand

for servers driven by cloud services and tightening of enterprise spending due

to the global COVID-19 pandemic. Omdia now projects an 8 percent increase of

server revenue in 2020—an upward revision of 8 percentage points from the

previous forecast. The forecast update increased the server market's value to

$85 billion for 2020.

"There were mainly two factors driving the update, one is the sustaining demand

for cloud services and the second one is the new CPU refresh cycle," Sukumaran

said. "Facebook would be deploying Yosemite v3 servers based on the latest

Intel Cooper Lake CPU, which will likely have a larger number of cores and will

be more costly than the Xeon D."

Omdia expects 13.2 million servers to ship in 2020, an 11.5 percent growth over

2019. This number is expected to top 18 million by 2024, with server shipments

growing at an 9 percent compound annual growth rate. Over 5 million or 26% of

all servers shipped in CY24 will be located at the edge, up from 2 million

(20%) in CY19.

In the second quarter of 2020, White Box Vendors, including Wiwynn, QCT

(Quanta), Tyan (MiTAC), and Ingrasys (Foxconn) took 24% share of server revenue

as the demand from CSPs remained strong. Dell EMC had 15% share followed by HPE

at 13%. Inspur had a strong quarter and increased its share to 12% in 2Q20, a

4% points gain over the previous quarter as reported by Omdia's Data Center

Server Equipment Market Tracker [https://omdia.tech.informa.com/OM006920/Data-Center-Server-Equipment-Market-Tracker---Q2-2020 ].

Lenovo rounded out the top five with 7% share.

About Omdia

Omdia is a global technology research powerhouse, established following the

merger of the research division of Informa Tech(Ovum, Heavy Reading and

Tractica) and the acquired IHS Markit technology research portfolio*.

We combine the expertise of over 400 analysts across the entire technology

spectrum, analyzing 150 markets publishing 3,000 research solutions, reaching

over 14,000 subscribers, and covering thousands of technology, media and

telecommunications companies.

Our exhaustive intelligence and deep technology expertise allow us to uncover

actionable insights that help our customers connect the dots in today's

constantly evolving technology environment and empower them to improve their

businesses – today and tomorrow.

Omdia is a registered trademark of Informa PLC and/or its affiliates. All other

company and product names may be trademarks of their respective owners. Informa

PLC registered in England and Wales with number 8860726, registered office and

head office 5 Howick Place, London, SW1P 1WG, UK. Copyright© 2020 Omdia. All

rights reserved.

*The majority of IHS Markit technology research products and solutions were

acquired by Informa in August 2019 and are now part of Omdia.

Infographic -

https://mma.prnewswire.com/media/1317265/Omdia_Sever_Shipments_2019_2024_Infographic.jpg 

Infographic -

https://mma.prnewswire.com/media/1317266/Omdia_2Q20_DC_Server_Revenue_Market_Share_Infographic.jpg 

Source: Omdia