IDC: Converged Systems Market Surpasses $12 Billion For First Time With Dell And Cisco Leading The Way

Dell, Cisco, HPE, Nutanix Duke It Out In Fourth-Quarter 2017

The global converged systems market continues to heat up, growing nearly 10 percent annually to more than $12.5 billion in 2017 compared with 2016, marking this the first year converged systems sales surpassed $12 billion, according to research firm IDC.

"The number of organizations deploying converged systems continued to expand through 2017," said Eric Sheppard, IDC's research vice president, enterprise servers and storage. "While not all market segments increased during the year, those that did grow were able to provide considerable benefits related to the core infrastructure challenges facing today's data centers."

For the fourth quarter of 2017, worldwide converged systems revenue hit $3.6 billion, up 9 percent year over year. IDC tracks sales of certified reference systems and integrated infrastructure, integrated platforms and hyper-converged offerings. CRN breaks down the top market leaders in each field.

Worldwide Certified Reference Systems And Integrated Infrastructure

Dell Market Share: 42.9%

Cisco/NetApp Market Share: 33%

HPE Market Share: 16.9%

The certified reference systems and integrated infrastructure market generated $1.7 billion in revenue during the fourth quarter, down 3.4 percent year over year. Dell was the market leader with $735 million in sales, followed by Cisco and NetApp with $565 million, then Hewlett Packard Enterprise at $289 million. Cisco and NetApp own a joint converged solution, FlexPod, which uses Cisco's networking and Unified Computing System with NetApp storage components.

Dell's 42.9 percent market share is down from the 48.4 percent share it held in fourth-quarter 2016 when it captured $859 million in revenue. Cisco and NetApp share increased from 27.4 percent in fourth-quarter 2016 to 33 percent; while HPE's share grew nearly 4 percent year over year to 16.9 percent.

Worldwide Hyper-Converged Systems Based On Brand Of HCI Solution

Dell Market Share: 27.8%

Nutanix Market Share: 19.5%

HPE Market Share: 4.9%

Cisco Market Share: 4.5%

Overall sales from hyper-converged systems – which include hardware and software -- increasednearly 70 percent year over year to $1.25 billion in fourth-quarter 2017. IDC ranked technology suppliers within the hyper-converged systems market by the brand of the hyper-converged solution or by the owner of the software providing the core hyper-converged capabilities.

For the branded solution, Dell was the largest supplier with $347 million in revenue, followed by Nutanix with $243 million in sales, HPE at $62 million and Cisco with $56 million in sales. Dell's market share grew from 19.8 percent in fourth-quarter 2016 to 27.8 percent, while Nutanix's share dropped from 21.9 percent to 19.5 percent during that same time. HPE increased its share from 1.9 percent in fourth-quarter 2016 to 4.9 percent, while Cisco's market share grew from 2.5 percent to 4.5 percent year over year.

Worldwide Hyper-Converged Systems, Based On Owner Of HCI Software

VMware Market Share: 32.4%

Nutanix Market Share: 29.5%

Dell Market Share: 7.7%

HPE Market Share: 5%

On the basis of hyper-converged infrastructure (HCI) software, systems running VMware's hyper-converged software represented $405 million in revenue for the fourth quarter, followed by Nutanix with $368 million, Dell at $96 million and HPE with $62 million.

VMware's market share grew from 26 percent in fourth-quarter 2016 to 32.4 percent, while Nutanix share declined from 31.4 percent to 29.5 percent in the same time. Dell's share dropped from 11.1 percent in fourth quarter 2016 to 7.7 percent, as HPE's share increased from 1.9 percent to 5 percent during the same period.