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August 17, 2007

How Big is the HPC Market, Really?

by Addison Snell

For a research analyst in any industry, there is one question that is fundamental: How big is the market? More specific questions support the same theme: How fast is the market growing? Who are the important players? What are the breakout opportunities? How big will the market be tomorrow?

Fast growth within HPC has been widely reported for the last several years. Falling hardware prices seem to have caused an increase in spending, among both traditional and non-traditional HPC users.

Just how big has the market gotten? Bigger than you think.

Before the cluster revolution, it was relatively easy to assess the size of the HPC industry. Analysts would simply do what analysts do in any industry: call the suppliers, and add up what was sold. Servers and supercomputers were self-contained items that you could point to and say, “That’s the HPC system I got from [insert vendor here].” Storage and applications were often purchased separately, but those accounted for a smallish portion of the solution.

Today the industry is trickier to size. Interconnects, accelerators, operating systems, and middleware might all come from a different source than the nodes themselves. As the node price falls, software and storage take up more of the budget. Furthermore, there is a proliferation of sales that are not easily tracked, because of users buying either through smaller vendors or through non-traditional channels.

To understand the size and growth trends in HPC, we need to look at more than servers. We need to understand a user’s complete HPC ecosystem.

The Role of Demand-Side Research

The straightforward way around this dilemma is to supplement supply-side (vendor) surveys with research into the demand-side (buyer) spending and usage models. Tabor Research is addressing this with two alternating surveys of the HPC user community: a site budget allocation map and an installation census. Each survey has only a few questions, but together they will provide a comprehensive view of how users purchase and configure their systems.

The site budget allocation survey, currently underway, asks users how their budgets are divided, on an approximate percentage basis, between and within categories such as hardware, software, staff, facilities, and services. For example, users will specify what percent of their budget goes to hardware, and within the hardware, what percent goes to servers, storage, networks, and so on.

With this data, plus some set points from supply-side research, we will able to model that most fundamental piece of information: the size of the overall HPC market. We’ll also learn the extent to which facility issues, like space and power consumption, can influence hardware and software budgets, and we can compare the amount spent externally on third-party software to the amount paid internally to staff members to write and maintain internally developed codes.

The HPC user installation census, which will begin in September and run for two months, will ask users what they currently have installed and how it is configured. This simple information will allow us to understand average configurations, upgrade patterns, and typical system life spans.

Sizing the New HPC

Early returns to the budget map survey indicate that users might spend more externally on software, service, and non-server hardware than they spend on the servers themselves. If that data holds true for the remaining surveys, it would mean the true size of the HPC industry could be more than double what was previously counted!

With our shift to High Productivity Computing, Tabor Research is aiming to size the entire HPC ecosystem. The external spending – money that users spend outside the organization – constitutes the HPC market. This will include servers, storage, interconnects, applications, middleware, and services of all types. In addition, we will examine portions of the internal spending in total available market analysis. For example, spending on staff for internally developed applications could help determine the total potential market for ISVs in that space.

The Challenges of Demand-Side Analysis

The reason analysts start with supplier data is simple. There are few suppliers, and many users. No matter how many surveys we run, we won’t get to everyone who’s bought an HPC system. The key to good market sizing information, therefore, is to reach enough users so that we can confidently model the census data we get from suppliers. The participation level in the various surveys is critical.

The budget map survey is still open, and it is important to capture as many user data points as possible, from a diverse group of users. Contact information is required, but individual responses remain anonymous. All respondents will receive a summary report, which will allow them to compare themselves to their industry peers. Results from our research will also be returned to the user community in the form of articles in HPCwire, public reports posted on the Tabor Research web site, and insights on the Tabor research blog.

Tabor Research is also seeking users of all types and sizes to form an HPC User Views Advisory Council. In exchange for regular participation in demand-side research (about one survey per month), Advisory Council members gain free access to Tabor Research data and report, inquiry time with analysts, and invitations to exclusive events.

The key to good HPC market intelligence is demand-side research. And the key to the demand-side research is user participation. Tabor Research was founded to give a voice to the user community. Your participation in our surveys and HPC User Views Advisory Council will shape the course of development in the HPC industry.

There are a lot of you out there making important spending decisions. More than people might think. And the industry wants to hear from you.

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Addison Snell is the VP/GM of Tabor Research. To participate in the site budget allocation survey or the HPC User Views Advisory Council, or to get more information, visit www.taborresearch.com or email Addison at Addison@TaborResearch.com.