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Public Cloud Providers Drive Sales for Data Centers

Large public cloud providers like AWS, Microsoft and Google are increasing data center hardware and software sales to unprecedented levels. Last year alone they invested $87 billion in servers, storage, software and network equipment.

The growth you are experiencing the public cloud is leading large providers to accelerate their investment in data center products. Firms like AWS, Microsoft and Google Cloud are driving these sales alongside companies like Dell Technologies, Inspur and Cisco, spending billions to equip new data centers with servers, storage, software, security and network infrastructure.

In fact, spending on data center products from public cloud providers now accounts for nearly half of total spending on data center hardware and software. This follows from the data published by Synergy Research Group.

According to the consultancy, revenue from global data center infrastructure equipment, including both cloud and non-cloud hardware and software, exceeded $185 billion last year. For its part, public cloud infrastructure represented 47% of the total market, that is, 87,000 million dollars.

As John Dinsdale, chief analyst at Synergy Research Group, points out, this total spending on data center hardware and software is an all-time high.

“Cloud providers have increasingly driven the data center equipment market and our five-year forecast shows that this trend will not stop.”

Providers Leverage Public Cloud Spending

Undoubtedly, these good forecasts are good news for technology providers that have positioned themselves to better serve hyperscalers.

Synergy also notes that this investment in hardware and software for data centers has grown 10% in 2021 thanks, mainly, to a 20% increase in spending on public cloud infrastructure.

In terms of market share in 2021, Dell, Microsoft and Inspur were the leading vendors in data center sales by providing public cloud providers with the hardware and software needed for their data center expansion.

Huawei and Cisco rounded out the top five market share leaders in sales for public cloud data centers.

The MDGswhich design and manufacture data center hardware such as servers and storage products, such as Quanta, Wiwynn, Inventec and Foxconn, accounted for the largest market share in terms of public cloud spending.

Dell leads the server and storage market and Cisco the networking market

With all this, from the consultancy they point out that they are sending more servers to cloud providers than to companies. This has led to the market leaders in enterprise infrastructure being Microsoft and Dell, followed distantly by Hewlett Packard Enterprise, Cisco, VMware and IBM.

By market segments, Dell is the leader in server and storage revenue, and Inspur leads server sales to public cloud providers.

The hardware-oriented server, storage and networking segments together accounted for 77% of the data center infrastructure market. Virtualization software, operating system, cloud management and network security account for about 23%.

Cisco has been the leading provider in the networking segment, while Microsoft has also stood out thanks to its server operating system and virtualization applications.

Initial image | Jack Kolpitcke

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