Hard-drive shortage hits servers in Q4, Gartner says

Shortage in supply in hard drive will slow down server shipments in the first quarter of this year

The growth in worldwide server shipments was slower than expected during the fourth quarter due to a shortage in the supply of hard drives, and the trend will continue into the first quarter this year, Gartner said in a study released on Thursday.

Worldwide server shipments totaled 2.5 million units during the fourth quarter last year, increasing by 4.5 percent compared to the same quarter in 2010. However, server makers could not meet demand due to hard-drive shortages. Shipments fell short of demand by around 200,000 units during the fourth quarter, said Jeffrey Hewitt, research vice president at Gartner.

Hard drives have been in short supply due to last year's floods in Thailand. The negative impact of the shortages will continue through the first quarter this year, after which server shipments are expected to grow for the rest of the year, Hewitt said.

Beyond the first quarter, server shipments are expected to grow as companies upgrade servers and build out hyperscale environments, Hewitt said. More processing power is needed in large-scale data centers with the fast growth in Web content and cloud services.

Server shipments will also receive a boost with new x86 server processors from Intel and Advanced Micro Devices, which could strengthen the server refresh cycle, Hewitt said. Intel is expected to announce new Xeon E5 server chips in March, which is the first major chip refresh for standard x86 blade, rack and tower servers since March 2010. Hewlett-Packard and Dell have already announced new servers with E5 chips.

Despite shipment growth, server revenue during the fourth quarter last year decreased year-over-year by 5.4 percent to $14 billion. IBM was the top server maker by revenue, followed by Hewlett-Packard.

But of the top three server vendors, Dell was the only company that experienced an increase in shipment and revenue growth. In terms of shipments, Dell was the second-largest server maker behind Hewlett-Packard, with shipments totaling 573,125 in the fourth quarter, growing year-over-year by 11.2 percent.

Dell was sharp on execution, taking advantage of strong build-to-order capabilities to deliver servers quickly and reduce customer wait times, Hewitt said. Dell also benefited from server growth in the emerging markets.

"It was about the smoothness of the fulfilment engine." Hewitt said.

Server shipments from Hewlett-Packard stumbled by 8.1 percent year over year to 704,853 units during the fourth quarter. Hewitt said HP was partly hurt by channel and delivery issues with x86 servers, and poor sales of high-end servers with Intel's Itanium chip. Oracle's decision to suspend software development for the Itanium processor also hurt HP, Hewitt said.

But HP's server business will recover over the year after the new servers ship, Hewitt said. There are also a lot of expectations from HP as CEO Meg Whitman sets the company's future strategy.

"We're waiting to see what the next moves are going to be under the new leadership," Hewitt said.

IBM was the third largest server vendor on shipments, which fell by 0.9 percent. IBM's high-end systems based on the Power processors did well, buoyed by a strong cyclical demand for mainframes. Hewitt couldn't make a projection on how Power-based mainframes will perform for the rest of the year.

But x86 servers are slowly replacing servers based on Itanium and RISC (reduced instruction set computer) chips, Hewitt said. Revenue of Unix servers fell from $2.9 billion to $2.7 billion during the fourth quarter, Hewitt said.

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Agam Shah

IDG News Service
Show Comments

Cool Tech

Breitling Superocean Heritage Chronographe 44

Learn more >

SanDisk MicroSDXC™ for Nintendo® Switch™

Learn more >

Toys for Boys

Family Friendly

Panasonic 4K UHD Blu-Ray Player and Full HD Recorder with Netflix - UBT1GL-K

Learn more >

Stocking Stuffer

Razer DeathAdder Expert Ergonomic Gaming Mouse

Learn more >

Christmas Gift Guide

Click for more ›

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?