ODMs reportedly to receive storage product orders from Facebook

Aaron Lee, Taipei; Joseph Tsai, DIGITIMES [Wednesday 2 January 2013]

Facebook reportedly plans to outsource new storage product orders to Taiwan-based ODMs with both Quanta Computer and Wistron having a chance to land the orders, according to sources from the upstream supply chain.

However, Quanta and Wistron have declined to comment on the rumors.

The sources pointed out that Facebook is handling its datacenter's hardware establishment through its Open Compute Project (OCP) and is outsourcing hardware production directly to ODMs, skipping server vendors. This business model has started to become popular among the big web players such as Google, Amazon and Baidu as it has advantages in price and efficiency.

Currently, Google's server production is fully outsourced to ODMs, while Amazon has about 30% of its servers delivered from ODMs and the percentage is expected to rise higher in 2013.

Since the big web players also wish to directly outsource network switches and storage devices to ODMs, the sources expect network switches to be integrated into server racks in the next two years, helping ODMs to expand their businesses to a higher level.

Facebook reportedly to outsource new orders to ODMs
Photo: Shihmin Fu, Digitimes file photo