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July 5, 2011

European firms looking to maximise blade server investment: IDC

Organisations in Western Europe purchased 280,800 x86 blade servers in 2010, equal to approximately $1.8bn

By CBR Staff Writer

European organisations are looking to maximise their investments in x86-based blade servers, as blade-related costs are perceived as a major challenge to their expansion, according a study from International Data Corporation (IDC).

The IDC study indicated demand for x86-based blade servers in Western Europe is strong, but observed some shifts are quickly changing the way this modular type of hardware is purchased and deployed.

The year 2011 will see provider switch and the adoption of new, leaner technologies as the dominant trends emerging.

Organisations in Western Europe purchased 280,800 x86 blade servers in 2010, equal to approximately $1.8bn or almost 25% of the x86 spending in the region, the report said.

However, in 2010 and for the first time since inception, spending on blade machines grew at a slower pace compared to traditional and scale-optimized rack machines (18% YoY versus 37% YoY).

A number of industry trends – from the growing weight of virtualization to the impact of a new Tier 1 player like Cisco, to the rise of new modular rack-type platforms built for higher density in scale-out environments – are reshaping the role of blade servers in European datacenters in 2011, according to IDC.

IDC European Systems and Infrastructure Solutions Blade senior research analyst Giorgio Nebuloni said customers typically show less interest in tower machines, a higher virtualization rate, and a high degree of standardization on blade platforms (44% of the installed base, versus less than 20% market average), versus a market that is still relying on rack machines for the majority of workloads.

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"Being so advanced technologically, blade users are now increasingly considering blade machines as a mature infrastructure component," Nebuloni added.

According to the survey, 18% of the respondents indicated a past or future change in blade supplier between 2010 and 2011, often driven by the opportunity to save money on server hardware or on other hardware (such as networking or storage).

In contrast, only 10% of the loyal customers mentioned cost of changing as a primary hurdle to switching hardware provider.

IDC program director of European Enterprise Servers Nathaniel Martinez said the survey results hint that blade customers can be broadly divided into two categories; in one case they own large datacenters and they have typically standardized on one or two blade suppliers; in the other, they operate smaller infrastructures, run multivendor environments, and tend to be more cost-conscious.

"In both cases, current users are still generally gung-ho about blade infrastructures, as proven by the fact that across segments the vast majority of customers expect to purchase the same amount of or more blades in 2011 compared to 2010," Martinez said.

IDC expects blade servers to gradually become legacy or "franchise" environments for standard enterprise applications, and we foresee the number of deployments to exhibit slower growth over the next years.

"Of the respondents polled, the preponderant majority had deployed their first blades prior to 2009. This means that the blade customer base will show limited growth in the future and suppliers will need to focus on increased penetration in current customers or on competitive ‘rip and replace’ activity," Nebuloni said.

"In this context, the addition of Cisco to a market currently dominated by HP and, to a lesser extent, IBM and Dell, has quickly made the blade enterprise play a zero-sum game.

"OEMs will increasingly find themselves forced to decide the extent and acceptable costs at which they are willing to defend their existing blade business. Tactical implementations in midsized datacenters, or installations that are lacking a deep consultative involvement with the customer (including supply of services and software), will be particularly at risk."

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