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Global data centre spend falls during Covid

(Image credit: Image Credit: Scanrail1 / Shutterstock)

Enterprise demand for data centre hardware and software is waning, as a direct consequence of the Covid-19 pandemic, a new report from Synergy Research Group claims. According to the quarterly market tracker, the spending in this area is down three percent, compared to last year.

On a global level, spending by both hyperscalers and enterprises grew seven percent for the second quarter of the year, mostly thanks to a huge spike (25 percent) in spending on public cloud-enabling data centre kits.

All in all, business spent north of $41.4 billion on data centre infrastructure in the second quarter of the year, with almost half (41 percent) falling onto public cloud infrastructure.

Three quarters of this spend went on servers, storage and networking kit, with the rest going on operating systems, virtualization, cloud management and networking security software.

“Cloud provider spending on datacenter hardware and software hit an all-time high, while enterprise spending on similar products was down from 2019,” said Synergy Research Group chief analyst, John Dinsdale, in a statement.

“While cloud service providers continue to go from strength to strength, elements of the enterprise market are being dogged by Covid-19 and related issues.”

The report further states that Dell sold most server and storage devices in the second quarter, while Cisco held its number one spot for networking gear. Microsoft earned most on server operating systems and virtualization software.

“In the middle of a global pandemic, spending on datacenter infrastructure was almost at an all-time high – second only to the fourth quarter of 2019. That speaks volumes about the continued robust growth in both enterprise and consumer cloud services,” Dinsdale added.

“There was also a geographic story behind the growth. The US market grew at a good pace in the quarter, but among the larger markets it was China that was the standout performer, jumping almost 35% from the second quarter of last year.”