Feeds

Taiwanese giant Quanta sold one out of every seven servers last year

'Hyperscale serving came to us, and we own it'

Security for virtualized datacentres

Coining money in tin and iron

While Quanta's server shipments are impressive, and the growth, considering how flat the server market has been in recent quarters, is equally eyebrow-raising, the revenue growth that Quanta is enjoying in its shiny hyperscale server biz will cause more than a few eyes to boggle.

Quanta is a public company, traded on the Taiwan Stock Exchange, and does not provide financials for specific product lines, but Yang was permitted to disclose that the Quanta server business was generating multiple billions of dollars per year in sales.

And thanks to a shift from ODM work on behalf of other vendors who slap their brands on the Quanta product (as happens in the laptop business all the time) to more direct sales right to hyperscale cloud operators, Quanta's revenues are projected to grow at a jaw-dropping 50 per cent this year.

Quanta's server revenues are growing five times faster than shipments

Quanta's server revenues are growing five times faster than shipments

Yang tells El Reg that direct sales made up only 34 per cent of the business in 2011 and the remaining 66 per cent was boxes it made on an ODM basis for other server OEMs. But last year, thanks in part to the growth of sales to companies like Facebook and Rackspace, that direct business grew by 143 per cent and is expected to double again in 2013.

The ODM part of the Quanta server business will actually shrink, but the overall server business will nonetheless rise by 50 per cent if all goes as planned at Quanta.

With shipments only up 10 per cent and revenues up 50 per cent, this suggests that Quanta is taking down some pretty beefy server installations this year. Yang says that rack-level shipments, where customers consume product by the rack, will be a big driver for growth.

Quanta will also have products available that are compatible with the Open Rack specification espoused by Facebook and its Open Compute Project later this year, and expects for OCP servers and racks to get more attention from hyperscale cloud operators. (Rackspace has already committed to using tweaked OCP designs, and others will follow whether or not we hear about them.)

Let's have some fun with math. As El Reg previously reported, if you take the volume of density-optimized servers (192,000 units) and the revenues ($705m) and divide the former in the latter, you get an average selling price of $3,672.

Assuming this is a reasonable amount of revenue for a bare-bones hyperscale box, then Quanta generated something on the order of $4.4bn from its server business in 2012. I happen to think the cost per server is lower than that, but do not have a hard time believing that Quanta could have generated $3bn to $4bn in revenues from its server biz.

Rackgo systems include servers, storage, switching, and batteries

Rackgo systems from Quanta include servers, storage, switching, and batteries

Here's the amazing bit. That revenue was generated across dozens – not hundreds, thousands, or tens of thousands – but dozens of customers. And here's the second amazing bit - boost that by 50 percent for where it will be in 2013.

That will be larger than the IBM Power Systems or the System z mainframe businesses in size, still a bit smaller than the HP ProLiant server business, but several times as large as the Cisco Systems UCS server business.

Quanta has around 600 engineers working away on server designs on behalf of customers back in its labs on the outskirts of Taipei, Taiwan, and does its manufacturing of motherboards and base systems in Shanghai. The company has finally assembly and configuration operations in Freemont for the Americas region and in Athens, Greece for the European region and moves its racked-up servers by truck to customers.

Quanta doesn't just build servers; it can do storage and switching, and honestly, in a modern hyperscale data center, these are converging anyway. The company has its own integrated rack design, called Rackgo, but will also support Open Racks this year for customers who want to do what Facebook does.

Quanta has over 100,000 employees worldwide – about the same size as Dell – and has over 7,000 employees at its Quanta Research and Design center in Taipei. And is it force that will be reckoned with. ®

Providing a secure and efficient Helpdesk

More from The Register

next story
It's Big, it's Blue... it's simply FABLESS! IBM's chip-free future
Or why the reversal of globalisation ain't gonna 'appen
IBM storage revenues sink: 'We are disappointed,' says CEO
Time to put the storage biz up for sale?
'Hmm, why CAN'T I run a water pipe through that rack of media servers?'
Leaving Las Vegas for Armenia kludging and Dubai dune bashing
Microsoft and Dell’s cloud in a box: Instant Azure for the data centre
A less painful way to run Microsoft’s private cloud
Facebook slurps 'paste sites' for STOLEN passwords, sprinkles on hash and salt
Zuck's ad empire DOESN'T see details in plain text. Phew!
Windows 10: Forget Cloudobile, put Security and Privacy First
But - dammit - It would be insane to say 'don't collect, because NSA'
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.