HPCwire: IDC Estimates HPC Market Grew 23 Percent In 2005

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March 03, 2006

IDC Estimates HPC Market Grew 23 Percent In 2005

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IDC's preliminary analysis indicates the high-performance and technical computing (HPTC) market grew about 23 percent in 2005 to reach a record $9.1 billion in revenue. This is the third consecutive year of 20 percent-plus growth in this market. IDC's analysis is based on actual revenue for the first three quarters of 2005 and preliminary revenue estimates for the fourth quarter.

The 2005 preliminary results revealed several significant market trends:

(1) The technical server market grew by 50 percent for the two-year period 2002-2004 and grew by 33 percent from 2003 to 2004 alone.
(2) Market growth in 2005 was driven by capacity computing segments, which include systems with average selling prices from less than $50,000 to $1 million. The high-end capability and enterprise segments showed slight declines.
(3) Cluster market share continued to show explosive growth and represented close to 50 percent of the HPTC market by the third quarter of 2005.

"HPTC systems vendors and their partners should consider their 2005 progress in light of the overall market growth, and they should continue to evaluate what role clustering will play in their current and future solutions," according to Dr. Earl Joseph, IDC's research vice president for High Performance Systems.

Situation Overview

IDC said the HPTC technical server market continues to see strong growth as scientists and engineers continue to expand their requirements for technical servers, especially standards-based clustered servers. Growth is driven by both purchases by traditional user sites and by new users able to make use if this technology as improvements in both absolute performance and price/performance bring the new capabilities within their reach.

According to Dr. Chris Willard, IDC research vice president for High Performance Systems, "Although two quarters of data do not make a trend, the resumption of strong year-over-year growth rates in Q2 and Q3 of 2005, combined with expectations for continued strength in Q4, drive our assumption for continued year-over-year revenue increases. We see the last several quarters of market data as pointing to a strong underlying growth pattern even if it natural market variability favors individual quarters," said Willard. "Short-term drivers may include such economic/geo-political factors as strengthening economies, world demand for petroleum, increased competitive requirements for product design, and increasing requirements in national security segments. At a more basic level, we believe that computational tools are continually growing in importance as vehicles for scientific discovery and engineering design."

"Cluster revenue through the first three quarters of 2005 exceeded the total for the previous full year. Year-over-year quarterly growth for clusters has been in the high 60 percent to low 90 percent range since the first quarter of 2004. The third quarter of 2005 saw the lowest year-over-year growth rate since Q302: 'only' 67.3 percent. IDC believes that technical users are looking to clusters as the underlying technology for acquiring and managing their base computational resources. Although non-clustered solutions are still expected to account for about half the market in 2005, cluster-based systems clearly are driving growth and are expected to dominate the market within the next few years," according to Willard.

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