Dell EMC and VMware are the top-selling hyperconverged infrastructure (HCI) vendors by revenue, according to IDC figures for fourth quarter 2017. Both companies are Dell Technologies’ brands. Dell Technologies owns about 80 percent of VMware, which it acquired from the Dell-EMC merger in 2016.
After a very public spat between Dell EMC and Nutanix over IDC’s earlier rankings based only on companies’ branded hardware products — Dell EMC sells these systems running Nutanix and VMware HCI software, so Dell EMC got all the credit because its name is on the box — IDC’s latest quarterly tracker ranks technology providers two ways. It ranks vendors by the brand of the hyperconverged product and by the owner of the software providing the core hyperconverged capabilities.
Dell EMC tops the branded-product list, and VMware is the leading HCI software provider, according to IDC.
Dell EMC was the largest HCI supplier by branded product with $346.8 million in revenue and a 27.8 percent market share. Nutanix generated $243.0 million in revenue with the second largest share of 19.5 percent. Hewlett Packard Enterprise (HPE) and Cisco were statistically tied for the quarter (meaning there’s a difference of 1 percent or less in the revenue share), with $61.6 million and $56.3 million in revenue and 4.9 percent and 4.5 percent market share, respectively.
On the basis of HCI software, systems running VMware’s hyperconverged software represented $405.1 million in fourth-quarter vendor revenue, or 32.4 percent of the total market segment. Systems running Nutanix’s software brought in $368.4 million, or 29.5 percent. Dell EMC also took the No. 3 spot for HCI based on its ScaleIO storage software with $96.5 million in revenue, or 7.7 percent. These values represent all software and hardware, regardless of how it was ultimately branded.
Overall HCI systems sales grew 69.4 percent year over year to $1.25 billion during the fourth quarter of 2017. This amounted to 34.3 percent of the total converged systems market. Full-year sales of HCI systems reached $3.7 billion in 2017, up 64.3 percent from 2016.
IDC’s quarterly report tracks the entire converged systems market and found that market value for these systems increased 9.1 percent, year-over-year, to $3.6 billion during the fourth quarter of 2017. Full-year sales exceeded $12.5 billion, a 9.4 percent increase over the previous year and the first time the market surpassed $12 billion in a calendar year.
Dell EMC Leads Converged Systems Market
The converged systems market includes three segments: certified reference systems and integrated infrastructure, integrated platforms, and HCI systems. Certified reference systems and integrated infrastructure are pre-integrated, vendor-certified systems containing server hardware, disk storage systems, networking equipment, and basic systems management software. Integrated platforms are sold with additional pre-integrated packaged software and customized system engineering optimized to enable such functions as application development software, databases, testing, and integration tools.
HCI systems collapse core storage and compute functionality into a single, highly virtualized solution. A key characteristic of hyperconverged systems that differentiate these solutions from other integrated systems is their scale-out architecture and their ability to provide all compute and storage functions through the same x86 server-based resources.
Meanwhile, in Integrated Infrastructure…
The certified reference systems and integrated infrastructure market generated $1.7 billion in revenue during the fourth quarter — a 3.4 percent year-over-year decline and 47.1 percent of the total converged systems market value. Dell EMC was the largest supplier in this market segment with $735 million in sales and a 42.9 percent share. Cisco/NetApp generated $565.6 million in sales for their FlexPod product, which was the second largest share at 33 percent. HPE generated $289.3 million in sales and captured 16.9 percent market share.
Integrated platforms sales declined during this time period, with an 18.1 percent year over year drop, generating $675.5 million in revenue. This amounted to 18.6 percent of the total converged systems market value. Oracle was the top-ranked supplier of integrated platforms with $360.5 million in revenue and 53.4 percent market share.