Blade Server Shipments Poised For Fourfold Increase - InformationWeek

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Blade Server Shipments Poised For Fourfold Increase

By 2011, blades are expected to account for nearly 21.6% of all server shipments, according to analyst estimates.

Global blade-server shipments are expected to nearly quadruple by 2011, driven by the young technology's advantages in flexibility, power savings and simplified manageability, a market research firm said Thursday.

Worldwide shipments are expected to rise to 2.4 million units in 2011 from 620,000 in 2006, according to iSuppli. Those numbers translate into a compound annual growth rate of 31.5%. By 2011, blades are expected to account for nearly 21.6% of all server shipments.

"With the advantages of high density, flexibility, power savings and simplified manageability, coupled with efforts from key blade server technology vendors to promote the interoperability of their products, iSuppli believes that blade servers will be the fastest-growing segment of the server market during the next few years," analyst Peter Lin said in a statement.

Houston-based RLX Technologies, now part of Hewlett-Packard, shipped the first blade server in March 2001. Sales were disappointing at first, but increased over time as HP and IBM introduced new generations that were more suitable for enterprise clients. As the market grew, Dell and Sun Microsystems, which had left the market, rejoined it at the end of 2006.

ISuppli defines a blade server as a modular server based on a single motherboard incorporating microprocessors, memory and network interface.

The server market in general could see a slowing in unit shipments over time as multi-core multiprocessor architectures and virtualization technologies in commodity servers lead to consolidation of more business applications in one machine. Those servers, however, are expected to carry a higher average selling price then today's typical server, so while shipments slow, the market's key metric -- revenues -- are expected to increase, iSuppli said.

If the trend towards virtualization, product interoperability and multi-core, low-power processors continue over the next few years, then the blade server market is expected to grab a larger share at the expense of other form factors, iSuppli said

The current battlefield of blade-server vendors is small and mid-size businesses, which have significant volume potential. Market leaders HP and IBM have tailored specific platforms to meet SMBs' requirements.

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