Server market revenues to grow 3% in 2014, says IC Insights

Servers accounted for an estimated 13% of total computer systems revenues in 2013, forecasted to reach record-high sales in the next three years before the next economic slowdown pulls the market down again in 2017 (Figure 1). Server sales are forecast to rise by a compound annual growth rate of just 1.5% between 2012 and 2017. The report also indicates that server unit shipment growth will be stronger in the next several years, driven predominantly by purchases of new less-expensive microservers.

Figure 1

High-density microservers contain many CPUs on microprocessors. they also emphasise power efficiency for massive amounts of lightweight-computing tasks, such as delivering thousands of web pages to users of smartphones and other mobile systems. Additionally, new microserver systems are being aimed at a wider range of data centre applications and new cloud-computing services. This computer segment has become a major battleground between Intel and several other processor suppliers developing new 64-bit MPUs with ARM CPU cores for server systems. This microserver market is forecast to achieve sales growth of 139% in 2014 to $580m (USD) from an estimated $243m (USD) in 2013. IC Insights have forecast microserver sales to rise by a CAGR of nearly 72%.

The total server IC market is projected to increase 3% in 2014 to $14.4bn (USD) after back-to-back annual sales declines of 2% in 2013 and 2012. Overall, the report expects the server IC market to rise by a CAGR of just 1.0% in the 2012-2017 period to $15.0bn (USD) in the final year of the forecast, but stronger revenue growth will occur in multi-core MPUs for microservers and NAND flash memories for solid-state drives, which can significantly boost the performance of servers by enabling more input/output operations per second than standard hard-disk drives.