What Happens When Hyperscalers And Clouds Buy Most Servers And Storage?
The Next Platform, Wednesday, April 17th, 2024
We have a long-standing joke that dates from the early 2000s, when the hyperscalers - there were not yet cloud builders as we now know them - started having hundreds of millions of users and millions of servers and storage arrays to run applications for them at the same time there was the beginnings of consolidation among the OEMs who created the servers and storage used by nearly all enterprises, including dot-com startups.
Here it is: 'We used to worry about a world where there might only be five sellers of servers and storage. Now, we worry that there might only be five buyers of servers and storage.'
Just as the coronavirus pandemic kicked in during the first quarter of 2020, according to data from IDC that we have been tracking like a hawk since it was first released in 2021 in its Worldwide Quarterly Enterprise Infrastructure Tracker, service providers - meaning hyperscalers, cloud builders, and other service providers who build datacenter infrastructure and sell capacity on it - as a group surpassed 50 percent share of combined server and storage revenues on Earth. They had accounted for more than half of unit shipments several years earlier, by our estimates.