A deep dive into the current state of server and client computing devices.
Introduction
Computer hardware is an integral part of our lives, especially in the modern workplace. Servers form the foundation our increasingly digital economy is built upon, and the vast majority of employees depend on client computing devices to complete essential daily tasks and communicate with colleagues.
Our annual State of IT report — a global survey of 1,000+ IT professionals — offers many insights into IT spending and tech adoption plans across hardware, software, cloud, and managed services. Our findings affirm that computer hardware is still as important as ever, accounting for the largest portion of overall tech spending at 30% of overall IT budgets.
In this special report, we’re diving into future and historical hardware data from the State of IT, sharing previously unpublished data to offer even deeper insights into laptop, desktop, and server trends we’ve observed over the past several years. Our in-depth findings highlight tech adoption plans that reveal spending shifts and opportunities for vendors as businesses modernize tech infrastructure to prepare for an increasingly hybrid future.
Servers Remain Vital, Even as Cloud Ascends
Much has been made of the shift from on-premises infrastructure to the cloud in recent years.
Our 2021 Cloud Trends report revealed that 40% of workloads are running in the cloud today, with that figure expected to rise to 50% by 2023. Additionally, our multi-year State of IT research shows cloud spending growing over time, increasing from 22% of overall IT budgets in 2020 to 26% in 2022.
During the same time period, new on-premises server investments have decreased. Overall hardware spending has dropped from 33% of IT budgets in 2020 to 30% in 2022. Within the hardware category, server spending accounted for 14% of hardware budgets in 2020 but will represent only 11% in 2022.
But make no mistake: On-premises servers remain extremely important to organizations worldwide. The majority of workloads today are still running locally, and in 2023 almost all organizations (94%) will still use on-premises servers in some capacity.
All this to say, cloud won’t fully replace local servers in the future. Instead, on-premises and cloud infrastructure will co-exist and grow increasingly interoperable, allowing for greater portability and flexibility that will benefit organizations in a hybrid world.
The Evolution of On-Premises Servers
For years, Intel was by far and away the dominant player in the server and client processor market. That is, until 2017, when AMD launched it’s powerful and cost-effective Epyc and Ryzen chips, which many IT professionals viewed as a legitimate challenge to Intel’s dominance.
At the time, many companies that didn’t use AMD chips were enticed by the company’s latest offering. In a 2017 Spiceworks poll of nearly 1,500 IT professionals, 61% of respondents said the launch of the new generation of chips made them more likely to consider using AMD.
Since then, the adoption of AMD chips has grown steadily. A Spiceworks State of Servers report found that 16% of businesses used AMD server chips in 2019. The latest 2022 State of IT findings reveal that 30% of companies use servers powered by AMD processors, and adoption of AMD-powered servers is expected to rise to 44% of businesses by the end of 2023.
AMD isn’t the only chip giant looking to disrupt the status quo. In recent years, energy-efficient ARM-based chips have also emerged as a viable alternative. Going forward, we see adoption rates of ARM server chips doubling from 11% today to 22% by 2023. IBM servers are poised to grow from 18% adoption to 27% by the end of 2023.
Over the next two years, adoption levels of non-Intel server processors are expected to be higher in larger organizations. Among enterprises (500+ employees), 61% plan to use AMD chips to power servers by the end of 2023, 51% will use IBM, and 43% plan to adopt ARM.