IT World Canada is reporting one Canadian research firm predicts server sales will fall by the end of 2007.
I’m not so sure massive virtualization adoption will drive a signficant loss of revenue.
Virtualization adoption focused customers attention to the single point of failure concept, imposing 3 mandatory requirements:
- high quality servers (reundant components) purchase
- redundant servers purchase
- additional hardware components (mostly SANs) purchase
Even a small company embracing virtualization has to invest in this direction, which translates in relatively lower quantities but higher profits.
This trend is probably doomed to invert itself again, when grid computing will become mainstream and a buying high volume of cheap servers will be a viable strategy (the one Google is adopting since beginning).