Hewlett-Packard Enterprise (HPE), Cisco Systems Ltd. and Microsoft remain at the top of the data center infrastructure market after a third quarter that saw total expenditure hit $29 billion, a three percent year-over-year increase.

Synergy Research Group, which compiled those numbers, defines “data center infrastructure” as encompassing servers, server OS’s, storage, networking, network security and virtualization software. It says that the big three of HPE, Cisco and Microsoft now dominate the market, which is worth some $120 billion a year. Synergy’s numbers are somewhat opaque as always, but it does note rapid growth in the sale of virtualization software, blade servers and integrated security platforms

Synergy actually splits the data center infrastructure market into three different segments. These include enterprise data center hardware, led by HPE with a 25 percent market share; service provider data center hardware, led by Cisco with 13 percent of the market; and data center software, where Microsoft takes the lead with a whopping 70 percent slice of the pie.

It was a great third quarter for HPE, which according to Synergy only overtook Cisco for the first time earlier this year and is now growing its lead rapidly, thanks to a solid performance in an otherwise flat enterprise hardware segment.

It’s not all bad news for Cisco though, as the networking giant managed to maintain its lead in the smaller but fast-growing service provider segment. Synergy put its success down to its “dominance of data center networking and its rapidly growing server business”.

“The mass adoption of public cloud services has created the need for widespread deployment of hyperscale data centers and has led to record spending on service provider data center equipment,” said Jeremy Duke, Synergy’s principal analyst. “While the market dynamics are different for private cloud, it too will drive enormous changes in the investment patterns for enterprise data center hardware, software, and services.”

As for Microsoft, its ranking position stems from its total dominance of the data center software market, the smallest of the three tracked by Synergy. VMware Inc. came in second in that category with just under twenty percent of the market.

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