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Research: Enterprise IT infrastructure spend still on the rise

09 Jan 18

Synergy has released new research suggesting that vendor revenues from IT infrastructure continue to experience growth, despite industry movements towards public cloud.

The research shows that across six key enterprise infrastructure segments, vendor revenues for the last four quarters increased by nearly 3% on an annualised basis.

Aggregate revenues for the last four quarters reached $113 billion, with revenue in each of the last twelve quarters typically in the $26-29 billion range.

While Synergy says data centre servers comprise the largest segment of the infrastructure market, this segment experienced a decline of almost 1% in 2017.

However, switches and routers  - which are the second largest segment - experienced growth of 4%.

Hosted and cloud collaboration grew the most while on-premise collaboration continued to be challenged by aggressive price competition and market disruption.

Synergy research group founder and chief analyst Jeremy Duke says the infrastructure market is set to keep experiencing growth for the immediate future.

“Despite a burgeoning public cloud market, enterprise IT infrastructure spending was still on the rise in 2017 and will be for the next five years,” Duke says.

“The focus of that spending is changing, however, with a growing emphasis on hosted solutions, subscription-based business models and emerging technologies. Those changes will continue to present challenges for incumbent vendors and opportunities for new market entrants.”

Cisco remains the dominant enterprise vendor,  leading the market in four of the six segments with the exceptions being hosted and cloud collaboration, (where it is ranked second) and data centre servers (where it is ranked fifth).

In aggregate across the six segments, Cisco’s market share over the last four quarters was 26%, down a percentage point from the preceding four quarters.

HPE is the second-ranked enterprise vendor with a market share of 11% across the six segments.

HPE is also the leader in data centre servers, the number two ranked vendor in WLAN and ranked third in switches & routers.

Hosted and cloud collaboration is the one segment where neither Cisco nor HPE are on top, with Microsoft leading in this area.

The number two ranked vendors in the other segments are Dell EMC (enterprise data centre servers), Huawei (switches and routers), Microsoft (on-premise collaboration) and Check Point (network security).

Synergy also says some other major vendors who have achieved particularly high 2017 growth rates in these highly competitive markets include Super Micro, Arista Networks and RingCentral.

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