VMware Leads HCI Market (Q3 2022)

IDC has produced their latest version of the Worldwide Converged Systems Tracker for Q3 2022 and has shown VMware to be on top again, nearly doubling the revenue of Nutanix, placed in second.

IDC has produced their latest version of the Worldwide Converged Systems Tracker for Q3 2022 and has shown VMware to be on top again, nearly doubling the market share of Nutanix, which placed in second.

VMware was also the only vendor to surpass the billion in sales number, which is roughly an 8% year-over-year gain for the company.  The full results from IDC are below.

HCI Software Vendor	2022 Q3 Revenue (in $ Millions)	Market Share	2021 Q3 Revenue	YoY Revenue Change
VMware	$1,062.47	40.76%	$984.92	7.87%
Nutanix	$616.87	23.66%	$583.05	5.80%
HPE/H3C	$187.80	7.20%	$189.77	-1.04%
Dell	$163.77	6.28%	$62.40	162.45%
Cisco	$92.76	3.56%	$104.13	-10.92%
Huawei	$91.36	3.50%	$111.24	-17.87%
Others	$391.84	15.03%	$334.70	17.07%
Total	$2,606.87	100.00%	$2,370.21	9.98%

Takeaways

VMware vSAN Ready Nodes and the engineered appliance versions from the likes of Dell and Lenovo always had the path of least resistance once vSAN worked out some of the early kinks and go-to-market decisions (anyone remember EVO: RAIL?). That said, Nutanix has continued to hang around. They’ve gone through a major leadership overhaul that will probably take at least 2023 to shake out whether or not they’ve sorted that out. While they started off as a value play, Nutanix has done well to continue to develop their own hypervisor and has recently invested in more deeply supporting container and cloud-based workloads.

HPE has moved hard to GreenLake, which may obfuscate some of their HCI progress because of the way IaaS is sold. While they still have SimpliVity as their own, the go-forward emphasis appears to be on Alletra (formerly Nimble). HPE has a disaggregated HCI solution that has a nice simplicity message for SMBs, but HPE also ends up tossing in the VMware pile as well with sales of vSAN Ready Nodes.

Cisco’s HyperFlex is the one that continues to surprise. Not with their sales, that it’s on the list at all. The last major update was in March of 2022 and Cisco hasn’t even mustered a blog about HyperFlex in six months. We’ve even been told that HyperFlex freebies are tossed into deals to close a sale. That said, with the explosion in edge data and current customer relationships, Cisco still may have something on its hands with HyperFlex, even if the company seems intent on keeping its HCI solutions hidden away.

Lastly, there’s still a giant chunk in the “Others” category that includes things like Azure Stack HCI and Red Hat solutions. We actually quite like Azure Stack HCI for a number of reasons, the primary amongst them being the feature set per dollar. But for a long time, Microsoft’s HCI solution was looked at as a server software sale, meaning trackers like this fail to account for the HCI business as a discreet entity. Microsoft has changed this now with Azure Stack HCI OS, which may mean they’ll bubble up. There’s also an interesting element with Azure Arc that’s developing as a potential visibility/control plane as well for hybrid infrastructure.

Regardless of your HCI flavor of choice or financial model of consumption, this market is clearly primed for growth as more data collection and analysis takes place outside of traditional data centers. It will be interesting to see though if some of the smaller revenue players decide to invest further in their own enterprise HCI solutions or bend the knee to VMware.

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