Gartner: x86 Server Virtualization responsible for rising server prices

CRN published an article last month containing an interview with Jeffrey Hewitt, who is vice president of research at Gartner. The interview is based on the outcome of the quarterly server sales report which is released by Gartner, the report states that in the third quarter of 2010 worldwide servers shipments totaled about 2.2 million units, up 14.2 percent compared to the same timeframe in 2009. This resulted in a in a total factory revenue of $12.3 billion which is 15.3 percent more compared to that same period in 2009.

Especially the rise in server revenue compared to the rise in server shipments (the 1.1 percent difference) is not seen in the market until now. Hewitt states that this is caused by a strong growth in x86 revenue because customers are purchasing servers with more high-end configurations for use in virtualizing server workloads.

"…"It’s a sign that investments in servers are resuming", he said. Customers are continuing to consolidate server workloads with virtualization. And there is a build-out of servers to handle workloads like Web serving, media streaming, and cloud computing

While several industry reports point to 2010 as the year when the number of virtual servers configured for customers exceeded the number of physical servers, Hewitt said the jury is still out on the question.

"It’s possible, but I don’t think so," he said. "It could be close. But we’re updating that right now. We may have more information in the first quarter (of 2011)…"