Dell, HPE, Cisco battle for HCI system leadership

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Dell, HPE, Cisco battle for HCI system leadership

The data centre hyperconverged system market wasn’t significantly disrupted by the COVID-19 pandemic in the second quarter of 2020 as worldwide sales remained flat on a year-over-year basis, according to new data from IT research firm Gartner.

Worldwide revenue from hyperconverged integrated systems hit US$821 million in the second quarter, representing flat annual growth. There wasn’t a decline in hyperconverged systems due to an increase in virtual desktop infrastructure (VDI) deployments to support work-from-home initiatives stemming from the coronavirus pandemic, Gartner said.

Gartner defines the hyperconverged integrated system (HCIS) market as an HCI platform offering with shared compute and storage resources based on software-defined storage, software-defined compute, commodity hardware, a unified management interface and direct-attached storage. For Gartner’s HCIS second-quarter 2020 market report, the brand selling the hyperconverged appliance received the revenue credit, not the software brand.

CRN USA breaks down the nine worldwide market-share leaders for hyperconverged systems in the second quarter of 2020.

No. 9: Nutanix

Q2 2020 Market Share: 0.8%

By design, Nutanix has nearly completely wiped out its stake in the hyperconverged appliance market as it successfully shifted into a software and subscription company. The company is the worldwide leader in hyperconverged software, according to Gartner, owning nearly 53 percent share of the global HCI software market. Only a tiny fraction of Nutanix’s total sales come via hyperconverged hardware systems, which the company has purposely transitioned away from over the past several years in favor of hybrid cloud software and subscriptions.

In second-quarter 2020, Nutanix generated US$6.5 million in HCIS sales, down 79 percent year over year. The company won 0.8 percent global share, down from 3.8 percent share in second-quarter 2019.

No. 8: Fujitsu

Q2 2020 Market Share: 1.2%

Fujitsu captured 1.2 percent share of the worldwide hyperconverged system market in the second quarter, up slightly from 0.7 percent share year over year. The Tokyo-based company generated US$10 million in data center HCIS sales, up from US$6 million in second- quarter 2019, according to Gartner.

Fujitsu provides a slew of hardware, software and services offerings while also recently making waves in high-performance computing thanks to its new Arm-based servers. The company’s Primeflex is a data center hyperconverged predefined, integrated and tested offering that combines servers, storage, network and software.

No. 7: Hitachi Vantara

Q2 2020 Market Share: 1.7%

Hitachi Vantara generated hyperconverged system sales of US$13.8 million in second- quarter 2020, up 38 percent year over year from US$10 million. The Tokyo-based company won 1.7 percent share of the worldwide data center HCIS market, up from 1.2 percent share in second-quarter 2019, according to Gartner.

The Hitachi Unified Compute Platform HC Series is an integrated turkey appliance powered by VMware vSAN that includes data protection and automated firmware upgrades. Earlier this year, the company named former Cognizant executive Gajen Kandiah as its new CEO.

No. 6: H3C

Q2 2020 Market Share: 8.7%

The No. 6 worldwide leader in hyperconverged systems is H3C, which won 8.7 percent share of the market in second-quarter 2020, up from 5.9 percent share year over year. The China-based company generated US$71.7 million in data center hyperconverged system sales during the quarter, representing growth of 48 percent year over year, according to Gartner.

H3C dubs its UIS hyperconverged infrastructure as the new generation of cloud data center infrastructure solutions for Infrastructure as a Service (IaaS). Hewlett Packard Enterprise owns a 49 percent stake in H3C, while China-based Unisplendour owns 51 percent.

No. 5: Lenovo

Q2 2020 Market Share: 8.8%

Lenovo generated US$72.1 million in hyperconverged system sales in second-quarter 2020, representing a revenue increase of 49 percent year over year. The Hong Kong-based company won 8.8 percent share of the worldwide HCIS market, up from 5.9 percent share in second-quarter 2019, according to Gartner.

Last month, Lenovo launched a slew of new hyperconverged infrastructure products in partnership with Nutanix, Microsoft, AMD and VMware. In its first fiscal quarter, which ended June 2020, Lenovo reported 20 percent sales growth for its Data Center Group by generating US$1.6 billion in revenue.

No. 4: Cisco Systems

Q2 2020 Market Share: 9.8%

The longtime networking giant witnessed a 27 percent drop in hyperconverged system sales in the second quarter. Cisco’s data center HCIS revenue was US$80.1 million, down from US$110.5 million year over year. The company’s worldwide market share fell from 13.5 percent share in second-quarter 2019 to 9.8 percent share, according to Gartner.

Recently, early retirement offers have been doled out and layoffs are being reported across geographies just months after Cisco announced a large-scale restructuring plan that would cut more than $1 billion in costs in the wake of financial fallout from the COVID-19 pandemic. This month, Cisco unveiled plans to buy Portshift, a security startup focused on application security for cloud-native development environments, including Kubernetes.

No. 3: Huawei

Q2 2020 Market Share: 12.4%

The China-based technology conglomerate won 12.4 percent share of the worldwide hyperconverged system market in second-quarter 2020, up from 11.6 percent share year over year. Huawei generated US$101.5 million in sales, up 6 percent compared with US$95.5 million in second-quarter 2019, according to Gartner.

Huawei reported strong storage sales growth in the first quarter of 2020 by capturing US$271 million in storage sales, which is impressive given the company has little storage sales in the world’s largest market, the US, with the US government seeking to ban the Chinese company from selling technology inside the country.

No. 2: Hewlett Packard Enterprise

Q2 2020 Market Share: 13.4%

Hewlett Packard Enterprise was the biggest sales growth winner for hyperconverged systems in the second quarter by generating US$110.2 million in HCIS sales, up 44 percent year over year. HPE won 13.4 percent share of the global market, up more than 4 points compared with 9.3 percent share in second-quarter 2019, according to Gartner.

Last month, HPE named George Hope as its new worldwide channel chief. Hope is a 22-year channel veteran with deep enterprise and SMB channel roots. “The call to action [for partners] is understand our strategy and get aligned with our strategy,” Hope said in a recent interview with CRN. “What we are doing up and down the organization is all aligning under the edge to cloud Platform-as-a-Service vision that [HPE President and CEO] Antonio [Neri] has.”

No. 1: Dell EMC

Q2 2020 Market Share: 37.4%

Dell EMC continues to be the dominant worldwide leader in hyperconverged systems, owning more than double the market share of any of its nearest competitors. However, although the data center infrastructure giant took the No.1 market-share spot, the company’s HCIS revenue fell more than 10 percent year over year, according to Gartner.

Dell EMC generated US$306.8 million in hyperconverged system revenue in second-quarter 2020, down 10.6 percent year over year compared with US$343 million. Dell’s market share dropped from 41.8 percent share in second quarter 2019 to 37.4 percent share.

Dell EMC, which is part of Dell Technologies, continues to perform relatively well as the world’s leader in server, storage and hyperconverged hardware despite the COVID-19 pandemic causing cash restraints for many businesses. For its second fiscal quarter, which ended July 31, Dell reported revenue of US$22.73 billion, down 3 percent year over year.

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