IDC: IT managers shifting from servers to SaaS

IDC expects that anywhere from 25% to 30% of all the servers shipped next year will be delivered to cloud services providers.

In three years, 2017, nearly 45% of all the servers leaving manufacturers will be bought by cloud providers.

“What that means is a lot of people are buying SaaS,” said IDC’s Frank Gens, referring to software-as-a-service. “A lot of capacity if shifting out of the enterprise into cloud service providers.”

The increased use of SaaS is a major reason for the market shift, but so is virtualisation to increase server capacity. Data centre consolidations are eliminating servers as well, along with the purchase of denser servers capable of handling larger loads.

IT managers will certainly be managing physical servers for years to come. But the number will be declining, based on market direction and the experience of IT managers.

The shift to cloud-based providers is roiling the server market, and is expected to help send server revenue down 3.5% this year, according to IDC.

Gens says that one trend among users who buy servers is increasing interest in converged or integrated systems that combine server, storage, networking and software. They account now about for about 10% of the market, and are expected to make up 20% by 2020.

Meanwhile, the big cloud providers are heading in the opposite direction, and are increasingly looking for componentized systems they can assemble, Velcro-like, in their data centers. This has given rise to contract, or original design manufacturers (ODM), mostly overseas, who make these systems for cloud systems.