Annual server shipments set to expand on corporate data-center demand: MIC

VIRTUAL GROWTH::As demand increases for cloud computing and virtualization, local firms could well see an increase in demand for servers

By Helen Ku  /  Staff reporter

Sat, Feb 16, 2013 - Page 5

This quarter, local server shipments are expected to contract 12 percent in the traditionally slow season, the Market Intelligence and Consulting Institute (MIC, 產業情報研究所) forecast.

However, it expects overall shipments for the whole year to grow year-on-year on the back of growing corporate demand for data centers and energy-efficient servers amid a recovering global economy.

Shipments by local manufacturers will be 1.16 million units this quarter, from 1.32 million units last quarter, MIC forecast.

Last quarter, shipments expanded 5.9 percent quarter-on-quarter, MIC said.

Wistron Corp (緯創), the world’s No. 3 contract notebook computer maker, expects its server shipments to fall 20 percent this quarter from last quarter, the Chinese-language Economic Daily newspaper reported, citing company chairman Simon Lin (林憲銘).

Ray Chen (陳瑞聰), chairman of Compal Electronics Inc (仁寶電腦), the world’s second-largest contract laptop maker, said his company has begun manufacturing servers and is actively seeking for orders from notebook brands Hewlett-Packard Co (HP) and Dell Inc, in a bid to take on Wistron and Quanta Computer Inc (廣達), the world’s top contract laptop maker, in the server market, the newspaper reported.

Rising demand for cloud-computing applications is expected to drive demand for servers, boosting shipments and elevating the ratio of non-brand servers, MIC said.

“Overall, on the back of increasing development of virtualization software, a growing need for energy-saving servers and rising demand for cloud-computing applications, we forecast new server products this year will be designed to be multifunctional, with features that enable them to execute integrated data-intensive applications within cloud-computing technologies,” MIC said in its latest report issued on Friday last week.

MIC analyst Lee Chian-li (李乾立) said that after Microsoft Windows Server 2012 was launched in the second half of last year with a relatively low price tag, competition in the virtualization software market appears to be more competitive, causing server makers to cut prices of their products in order to make profits and triggering more enterprises to use more servers to run virtualization software.

He forecast that only larger customized data centers would be looking for highly integrated servers this year, as the products use a lot of electricity, whereas normal enterprises’ smaller data centers would not have high power transmission capacity.

As more 32-bit chips are used in servers manufactured using low-energy ARM-based architectures and chipmaker Intel Corp has rolled out Atom-based servers to take on those products, Lee forecast that low-power processors would become the main products manufacturers are looking to produce this year.