Server investment, semiconductor industry ↓, financial industry ↑
Custom x86 ODM Server Market Grows 16%
Server adoption is expanding across business divisions


IDC Korea announced on the 7th, through its 2019 domestic server market report, that the domestic server market in 2019 reached 1.5632 trillion won, a 1.1% increase from the previous year.

Despite the contraction in server investment in the semiconductor industry, the active use of cloud services and increased server investment in the financial industry are analyzed to have contributed to market growth.

When the market is segmented, it was found that different patterns are observed depending on the product category.

In the x86 server market, OEM servers, which are typically provided by vendors, formed a market worth 1.1071 trillion won while maintaining a somewhat low growth rate of 0.6% year-on-year; however, the ODM server market, which consists of custom-ordered systems provided only to specific customers, recorded a size of 219.3 billion won, growing 16% year-on-year.

From the perspective of server units, OEM servers reached 142,500 units, an increase of 992 units with a 0.7% growth year-over-year, while ODM servers reached 29,913 units with an 11.9% growth, an increase of more than 3,000 units year-over-year.

Looking at it from the perspective of server demand, previously IWhile the focus was previously on bulk adoption by a dedicated organization, it appears that server adoption is expanding by Business Unit (BU) or business department recently.

The report stated that as customer server demand patterns diversify, server vendors need to enhance their expertise by unifying the supply of various products—including servers, storage, related applications, and security—and ensure high availability through improved synergy between products.

Many companies are focusing on enhanced computing platforms to implement digital transformation. While environments and methods for delivering computing resources have become more diverse than in the past, stable computing operations ultimately remain a prerequisite. Accordingly, server vendors are increasingly introducing differentiated policies.

Due to COVID-19, there are distinct changes in domestic server demand. Not only the entertainment industry, such as video streaming and online gaming, but also the education industry is seeing an increase in the proportion of online education, leading to a rise in the adoption of server systems by universities as well as the Ministry of Education.

Although online shopping has made sufficient preparations for traffic surges by continuously adopting public cloud services, gradual infrastructure expansion is expected due to concerns about the prolonged COVID-19 pandemic.

Kim Min-cheol, a senior research analyst at IDC Korea, stated, “In terms of server investment by B2B companies, there will be no significant change in server demand from large enterprises maintaining their existing pipelines,” adding, “With face-to-face sales by server vendors restricted, expanding into new markets targeting regional areas or small and medium-sized enterprises will face difficulties.”