Server market in India is going through a tough transition phase. According to International Data Corporation (IDC), small and medium sized companies are expected to drive growth in coming quarters as large enterprises hold back investments in view of coming elections. Sectors like Transportation, Education and Utilities are seen progressively investing in technology whereas the traditional ones are spending cautiously.
Janmaijai Dhyani, Market Analyst, Enterprise Computing – Servers, IDC India says “Indian Server Market saw a 12% decline in terms of unit shipment quarter–on-quarter in Q4 2013 as compared to Q3 2013 as the sentiment among corporate sector was pessimistic due to the possibility of a weak government at the centre, coupled with ongoing economic malaise which had a debilitating impact on IT infrastructure expansion and technology refresh demand.”
Spending on non-x86 servers which are primarily deployed for running mission-critical workloads to support core-business processes declined an astounding 32% in terms of revenue quarter-on-quarter in Q4 2013.
"With Lenovo entering the server market and vendors eyeing more coverage of channel (especially for x86 server market) rather than direct business, 2014-15 definitely looks exciting amidst the elections and changing market sentiment," says Gaurav Sharma, Research Manager – Enterprise Computing, IDC India
Strong adoption of server virtualization and cloud technologies in the enterprise segment, rapidly increasing appeal of public cloud providers for specific workloads, and growing interest in Integrated Systems were some of the key technology disruptions that impacted the server spending growth in 2013. Corporate sector is anticipating for the elections to get over and is holding its investments till the time a stable government comes into picture. Large refreshes and upgrades which are due for long are expected in the coming quarters.
In India x86 server market, HP continued to lead in Q4 2013 with unit shipment share of 31%, followed by IBM with a share of 24% and Dell with a share of 18%. The channel strategy opted by Dell is expected to have a positive impact on their business in coming quarters.
IDC India Forecast
Special projects in the Government space continue to be a key staple in the server market space This momentum in the special projects in Government space is expected to be on a slower pace in 2014 due to pending elections. However verticals like Professional services, Telecom (select investments), Banking and Education are expected to spend on technology and drive Enterprise server market in the coming quarters.