Cloud giants boosts Dell, Cisco, data centre sales

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Cloud giants boosts Dell, Cisco, data centre sales

Public cloud providers like AWS, Microsoft and Google Cloud are boosting data centre sales for the likes of Dell Technologies, Inspur and Cisco following billions in spending last year on equipping new data centres with servers, storage, software, security and networking infrastructure.

In fact, spending on data centre products from public cloud providers now accounts for nearly half of all spending on data centre hardware and software, according to new data from Synergy Research Group.

Worldwide data centre infrastructure equipment revenue, including both cloud and non-cloud hardware and software, topped US$185 billion in 2021, with public cloud infrastructure accounting for 47 percent, or US$87 billion, of the total market.

The total US$185 billion data centre hardware and software market spend is an all-time high, according to Synergy’s John Dinsdale.

“Cloud providers have increasingly driven the market for data centre gear and [our] five-year forecast shows there will be no letup in this trend,” said Dinsdale, a chief analyst at Synergy Research Group, in an email to CRN. “This is good news for the tech vendors who have positioned themselves to better serve the hyperscale cloud providers.”

Worldwide spending on data centre hardware and software grew 10 percent year over year in 2021 to US$185 billion, primarily thanks to a 20 percent spike in spending on public cloud infrastructure, according to Synergy Research Group.

Cloud providers like AWS, Microsoft Azure and Google Cloud are investing heavily in their data centres to accommodate the demand for cloud services.

Comparatively, enterprise spending on their own data centre infrastructure grew three percent in 2021 year over year to approximately US$98 billion. However, it is key to note that enterprise spending on their own data centre products declined 6 percent in 2020 compared to 2019.

This means that enterprise spending on their own data centres was lower in 2021 compared to 2019.

Dell, Inspur, Microsoft and ODMs reaping public cloud spending

In terms of 2021 market share: Dell, Microsoft and Inspur were the leading vendors for data centre sales in providing public cloud vendors with the hardware and software needed for their data centre expansion. Synergy said Dell, Microsoft and China-based Inspur all had roughly similar market share in terms of sales.

Chinese technology conglomerate Huawei and San Jose, Calif.-based global networking leader Cisco rounded out the top five market share leaders for public cloud data centre sales.

Original design manufacturers (ODMs), who design and manufacture data centre hardware like servers and storage products that are sold directly to the world’s largest cloud players, accounted for the most market share in terms of public cloud spending. However, Synergy groups all ODMs together. Some examples of top ODM vendors include the likes of Quanta, Wiwynn, Inventec and Foxconn.

Server shipments to cloud providers surpass enterprise

Interestingly, Synergy said vendors are now shipping more servers to cloud providers than enterprises.

“[Server] unit shipments to public cloud providers have now far surpassed enterprise volumes, though the difference in value of the two market verticals is much less pronounced due to higher enterprise server ASPs. That gap in value will grow as public cloud server volumes continue to surge,” said Dinsdale.

The 2021 market leaders in enterprise infrastructure were Microsoft and Dell, followed at a distance by Hewlett Packard Enterprise, Cisco, VMware and IBM.

By segment, Dell is the overall leader in server and storage revenues, with Inspur being a clear leader in server sales to public cloud providers.

Dinsdale said the data centre equipment market is expected to grow over the next few years, specifically thanks to public cloud providers.

“We forecast that these trends will continue over the next five years, with double-digit annual growth in sales to cloud providers helping to offset a somewhat flat enterprise market,” he said.

The hardware-oriented segments of servers, storage and networking in aggregate accounted for 77 percent of the US$185 billion data centre infrastructure market in 2021. Virtualization software, OS, cloud management and network security account for approximately 23 percent. Cisco was dominant in the networking segment, while Microsoft was featured heavily due to its position in server OS and virtualization applications.

This article originally appeared at

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