WW Converged Systems Revenue Decreased 1.4% Y/Y in 4Q16 at $3 Billion – IDC

According to the International Data Corporation‘s Worldwide Quarterly Converged Systems Tracker, worldwide converged systems market revenues decreased 1.4% year over year to $3.09 billion during 4Q16.

The market consumed 1.6EB of new storage capacity during the quarter, which was up a moderate 4.0% compared to the same period a year ago.

For the full year 2016, worldwide converged systems market revenues increased 5.8% to $11.3 billion when compared to 2015.

“The converged systems market is going through a period of change,” said Eric Sheppard, research director, enterprise storage and converged systems. “We are seeing strong growth from products with new architectures, increased levels of automation, and heavy use of software-defined technologies. This growth has been offset by reduced spending on traditional converged systems and a conscious decision by some vendors to terminate some parts of their product portfolio.”

Converged Systems Segments
IDC’s converged systems market view offers four segments: integrated infrastructure, certified reference systems, integrated platforms, and hyperconverged systems. Integrated infrastructure and certified reference systems are pre-integrated, vendor-certified systems containing server hardware, disk storage systems, networking equipment, and basic element/systems management software. Integrated platforms are integrated systems that are sold with additional pre-integrated packaged software and customized system engineering optimized to enable such functions as application development software, databases, testing, and integration tools. Hyperconverged systems collapse core storage and compute functionality into a single, highly virtualized solution. A key characteristic of hyperconverged systems that differentiate these solutions from other integrated systems is their scale-out architecture and their ability to provide all compute and storage functions through the same x86 server-based resources.

During 4Q16, the combined integrated infrastructure and certified reference systems market generated revenues of $1.57 billion, which represented a year-over-year decrease of 15.7% and 50.8% of the total market. Dell Technologies was the largest supplier of this combined market segment with $705.1 million in sales, or 44.9% share of the market segment.

Top 3 Vendors, WW Integrated Infrastructure and Certified Reference Systems, 4Q16
(revenue in $ million)
* Note: Dell Technologies represents the combined revenues for Dell and EMC sales for all quarters shown.

Integrated Platform sales declined 8.6% year over year during 4Q16, generating $823.5 million worth of sales. This amounted to 26.6% of the total market revenue. Oracle was the top-ranked supplier of Integrated Platforms during the quarter, generating revenues of $406.9 million and capturing a 49.4% share of the market segment.
 

Top 3 Vendors, WW Integrated Platforms, 4Q16
(revenue in $ million)

WW Converged Systems Market by Product Category – 4Q15-4Q16

(Source: IDC Worldwide Quarterly Converged Systems Tracker, March 23, 2017)
 
* Note: IDC declares a statistical tie in the worldwide converged systems market when there is a difference of one% or less in the vendor revenue shares among two or more vendors.

Hyperconverged sales grew 87.3% year over year during 4Q016, generating $697.4 million worth of sales. This amounted to 22.6% of the total market value. The hyperconverged system market surpassed $2.2 billion in global revenue during the full calendar year (2016), which was 110% higher than 2015.

Taxonomy Notes:
IDC defines converged and hyperconverged systems as pre-integrated, vendor-certified systems containing server hardware, disk storage systems, networking equipment, and basic element/systems management software. Systems not sold with all four of these components are not counted within this tracker. Specific to management software, IDC includes embedded or integrated management and control software optimized for the auto discovery, provisioning and pooling of physical and virtual compute, storage and networking resources shipped as part of the core, standard integrated system. Numbers in this press release may not sum due to rounding.