Tight budgets favor low-end servers

02.12.2008
Server shipments grew in the third quarter this year, though server revenue declined as companies lowered spending to meet budgetary constraints, according to a study released by Gartner on Monday.

Purchase of more expensive systems, like Unix servers, were put on hold as buyers tried to keep spending in check during the quarter, said Jeffrey Hewitt, research vice president at Gartner.

Buyers instead opted to buy lower priced x86 systems, which saw a growth in shipments during the third quarter. However, vendors saw revenues on x86 systems drop on lower average selling prices, Hewitt said.

Server markers shipped more lower priced x86 servers with two and four processor sockets, which led to more aggressive pricing on servers, Hewitt said.

Coupled with lower-end server purchases, companies are also investing in new server technologies like virtualization, where server workloads are consolidated into virtual environments, Hewitt said. That helped reduce spending on server technologies as companies try to meet budgetary constraints.

Blade servers with x86-based chips also witnessed healthy growth during the quarter, Hewitt said. Companies are taking advantage of the flexibility provided by blade servers to work in different environments, from performing basic applications to being scalable enough to handle heavier workloads in data centers, he said.