Intel: Influence in Server Market Shifting

In a conversation with journalists, processor maker Intel recently highlighted the fact that more companies are sharing the server market than just a few years ago.

Against the perception that IBM, HP and Dell are selling three quarters of all servers, Diane Bryant, vice president of Intel's datacenter and connected systems group, stressed that there are now eight "server makers" that account for 75 percent of the market.

The reason is not so much the emergence of new vendors, but much more a market traditional vendors cannot capture. Google is designing its own servers, and so does Facebook as well as Amazon, at least in part. Those custom servers that are tailored to very specific needs are built in Asia by ODMs such as Quanta, Huawei and SuperMicro, which are known to build huge numbers of PCs with razor thin profit margins.

Thanks to huge ordering volumes, Google and Facebook are likely to have a similar negotiation leverage as do HP, Dell and IBM. While the potential market server vendors are missing out today is substantial, the trend is limited to the very largest companies today.

Wolfgang Gruener is a contributor to Tom's IT Pro. He is currently principal analyst at Ndicio Research, a market analysis firm that focuses on cloud computing and disruptive technologies, and maintains the conceivablytech.com blog. An 18-year veteran in IT journalism and market research, he previously published TG Daily and was managing editor of Tom's Hardware news, which he grew from a link collection in the early 2000s into one of the most comprehensive and trusted technology news sources.

See here for all of Wolfgang's Tom's IT Pro articles.

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