It's sales boom time for (some) converged infrastructure vendors

Integrate all the things!

The world’s great enterprise hardware vendors are in a dog fight – to dominate the buoyant market for converged infrastructure.

Global sales in Q1 2015 totted up to $2.1bn, up 8.3 per cent year on year, according to IDC.

It is highly competitive out there, says Kevin M. Permenter a research analyst, who covers enterprise servers for IDC. The last 12 months has seen "key competitors undergo major reorganization, rebranding and realignment; all with the intent to strategically position themselves in one of the faster growing segments of the datacenter infrastructure market".

IDC dubs this sector "Integrated Infrastructure and Platforms" – and treats Systems and Platforms as distinct segments.

Infrastructure (i.e. hardware) is the bigger of the two, accounting for $1.3bn sales in the quarter, up 15.5 per cent on last year. IDC has worked out that the market generated 945 petabytes of new storage capacity shipments during the quarter, which was up 45.7 per cent compared to the same period a year ago.

In its summary for public consumption, IDC names only the top three integrated systems vendors: VCE, Cisco-NetApp and HP. "All Others" make up a beefy back of the pack. As you can see from the table below VCE has supplanted Cisco/ NetApp as market leader over the last year and all three are growing fast. "All Others" are collectively losing market share and are not experiencing sales growth. So who is hurting here?

IDC: Top Vendors, integrated infrastructure, Q1 2015

Vendor	1Q15 Revenue	!Q15 Market Share	1Q14 Revenue	1Q14 Market Share	1Q15/1Q14 Revenue growth
VCE	$328.85m	24.1%	$254.28m	21.5%	29.3%
Cisco/NetApp	$307.32m	22.6%	$268.41m	22.7%	14.5%
HP	$242.58m	17.8%	$172.76m	14.6%	40.4%
All Others	$483.94m	35.5%	$484.66m	41.1%	-0.1%
Total Factory Value	$13,62.68m	100%	$1,1180.11m	100%	15.5%

Integrated Platforms - not the same thing at all

Integrated platforms as characterised by IDC looks like a much more traditional set-up than converged infrastructure, as demonstrated by Oracle’s dominance in this segment - and flat Q1 revenues of $755.4m, down 2.5 per cent on last year.

IDC defines integrated platforms by the software that is sold with the hardware, namely:

“Additional pre-integrated packaged software and customized system engineering optimized to enable such functions as application development software, databases, testing, and integration tools. Integrated Infrastructure systems are designed for general purpose, distributed workloads that are likely to have differing performance profiles. While integrated infrastructure is similar to integrated platforms in that it will leverage the same infrastructure building blocks, it is not optimized for a specific workload.”

That seems clear enough. And as you can see from the table, Oracle is runaway market leader - and its sales are growing. IBM is the clear loser here. Is this fall-out from sales from the x86 server business to Lenovo? Hitachi and HP are also doing well in this segment, albeit growing from small bases.

IDC: Top Vendors, integrated platforms, Q1 2015

Vendor	1Q15 Revenue	1Q15 Market Share	1Q14 Revenue	1Q14 Market Share	1Q15/1Q14 Revenue growth
Oracle	$391.98m	51.9%	$370.37m	47.8%	5.8%
IBM	$42.35m	5.6%	$75.89m	9.8%	-44.2%
T3. Hitachi	$25.18m	3.3%			100%
T3. HP	$23.79m	3.1%	$15.48m	2.0%	53.7%
All Others	$272.14m	36%	$44.57m	40.4%	-13.1%
Total Factory Value	$755.44m	100%	$774.88m	100%	-2.5%

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