Although global shipments of blade servers are set to decline in 2009, the market is expected to return to robust double-digit growth during the following years as global economic conditions improve, according to iSuppli.
Blade server shipments will amount to 1.04 million units in 2009, down 9 percent from 1.14 million in 2008. This contrasts sharply with the 31.1 percent increase in 2008.
“In its short history, the blade server market has been able to slash through whatever obstacles the global economy and technology business have placed in front of it. However, in 2009, the blade servers couldn’t cut through the global economic downturn, causing shipments to decline for the first time ever,” said Peter Lin, the iSuppli analyst.
iSuppli has been continually reducing its shipment forecast throughout the year. According to them, the main factor impacting the market is conservative corporate Information Technology spending at the end of 2008 and in 2009 resulting from the recession.
Analysts expect that the blade server market will regain its edge somewhat in 2010, when the worldwide economy improves. By 2013, the market will more than double from its 2008 level to more than 2 million units.
During the period from 2008 to 2013, the blade server market will expand at a CAGR of 13.9 percent, 10 times higher than the server market as a whole. By 2013, blades will account for 23.1 percent of all server shipments, up from 12.9 percent in 2008.
“This clearly indicates that the blade segment will be the fastest-growing and most important segment of the server industry through 2013,” Lin said.
Although iSuppli has reduced the total server shipment forecast due to the worldwide economic recession, the company retains its belief that virtualization offers a number of benefits in the consolidation of server infrastructure.
“Virtualization provides a more efficient server roll-out strategy, which will accelerate enterprise adoption. Therefore, iSuppli’s virtualization forecast is a mid-to-high penetration scenario, where we believe virtualization server penetration of total server shipments will rise at a CAGR of 18.8 percent during the period from 2008 to 2013,” iSuppli states.
The research group also believes that cloud computing can effectively leverage blade servers and virtualization. “Seeing the potential for cloud computing, there is a race among the main players, which iSuppli believes will become increasingly fierce as the demand for cloud computing keeps growing,” they say.
According to iSuppli, cloud computing will have a negative effect on server shipments. However, they say, there will be more applications released and users will demand better service levels. Therefore, the demand from the cloud computing service providers will keep increasing, which will offset the negative effect, as they claim.