Cloud Server Shipments Slip in 2Q 2015

Recent research shows that the server market is going strong but that one of its driving forces, shipments to cloud data centers, has slipped in the most recent quarter of 2015.

Shipments to cloud data centers, Dell (News - Alert)'Oro Group reported, showed signs of slowing in 2Q 2015. However, despite its lessening of pace, such shipments continue to play a primary part in the overall market. Sameh Boujelbene, the director of Dell'Oro Group, commented in the report's associated news brief, that cloud deployments, overall, are doing well even though the most recent quarter did not set record numbers.

“Cloud data center deployments continued to grow and comprised a higher portion of shipments. However, cloud growth was modest in 2Q15 compared with the two previous record-setting quarters,” Boujelbene said. “CAPEX growth rates of the leading four cloud data center accounts suggest a decelerating growth trend. Although this deceleration might be viewed as an indication of a maturing market, we believe that server shipments to cloud data centers will continue increasing over at least the next five years and that the pause in the second quarter is temporary, reflecting the lumpy nature of cloud data center deployments.”

The big four cloud data center accounts Boujelbene references are, listed alphabetically, Amazon, Facebook, Google (News - Alert) and Microsoft. On one hand, the director's comment provides some good news about the state of the market–that it has matured. However, his speculation that the second quarter shipment rate drop is temporary could give readers pause.

Dell'Oro group will certainly continue to watch the market as this third quarter develops. Cloud shipments have made their mark in recent months with the record numbers they posted in 2015. Vendors and their partners, as well as cloud center users, should also be on alert about the trends now taking place.

A separate piece of research from Synergy (News - Alert) Research indicates that virtualization and cloud computing remain the biggest forces driving demand for data center infrastructure. Companies across the globe look to the cloud to drive all facets of their businesses–everything from data security to application delivery–and virtualization plays a large part in those areas as well.