Lenovo becomes the biggest x86 server provider in China as acquisition of IBM x86 server business completes, says IDC

IDC's latest data on China x86 server market shows, Lenovo shipped 99,101 units in the first half of 2014 and ranked fourth among all vendors in the same category. Combining IBM and Lenovo's shipments in the period would make Lenovo the biggest vendor in China's x86 server market with a market share of 23.9%.

IDC expects Lenovo's acquisition to have various impacts on the domestic and global market landscape. Lenovo's server product line and IBM's System x server product line are highly complementary with little overlap. After the acquisition is completed, IBM's four-socket server and blade server lines will be combined with Lenovo's volume products, and a more comprehensive product portfolio will be shaped. At the same time, Lenovo will combine its regional reach with IBM's experience in product R&D, to enhance its overall competitive advantage, which will impact other vendors in the market.

IDC also said it believes that after one or two quarters to stabilize and integrate internally, Lenovo will regain the market share that it previously lost to its competitors during the period of initial integration, and its growth momentum will be fueled especially in the time when the large Internet companies in China are still investing heavily in datacenter construction. Additionally, Lenovo will integrate the channels of IBM's System X with its own existing channel resources, and will position itself as a partner instead of a competitor. IDC said it also expects Lenovo to enhance its cooperation with software providers such as Microsoft and VMware.

As a domestic vendor, Lenovo's leading position in the market after the acquisition will help other domestic vendors establish their own brand images. IDC expects made-in-China solutions to become more popular in the local enterprise IT market.

From the perspective of the global market, through the acquisition, Lenovo has become one of the world's top-three x86 server vendors with a global market share of 11.7% in the first half of 2014. IDC notes that Lenovo's previous acquisition of IBM's PC business in 2005, and the subsequent nine years of operation has made it the industry leader in the global PC market. And the successful experience will help Lenovo realize smooth integration of the newly-acquired server business. This will also help Lenovo expand its market overseas by replicating its success in the PC field.

Source: IDC, compiled by Digitimes, October 2014

Source: IDC, compiled by Digitimes, October 2014

Source: Digitimes