Dedicated servers are back in vogue as IT leaders scramble to meet AI, compliance requirements

Organizations are increasingly reliant on dedicated servers, new research from Liquid Web shows, and AI performance requirements are a key factor in their revival.

In a survey of more than 1,000 IT professionals across industries and company sizes, 86% said their organization is currently using dedicated servers, with government (93%), information technology (91%), and finance (90%) the most likely to do so.

The trend appears even within smaller businesses, with 68% of micro companies reporting using them - and these numbers are growing. In the past 12 months, 42% of respondents said they've migrated workloads from public cloud back to dedicated servers.

Just over one-third of respondents (34%) said their organizations increased spending on dedicated servers in 2024 - more than in any previous year.

"This upward trend in 2024 spending reflects a broader shift back to dedicated environments, with 42% of IT professionals saying they migrated workloads away from the public cloud in the past 12 months," Liquid Web said.

In terms of workloads, they're being mainly used for databases, large-scale file storage, web hosting, internal developer environments, compliance-sensitive systems, and AI model training or inference.

Just over half of respondents said they'd never use public cloud for regulated data such as healthcare or finance, with others citing core databases, performance-intensive computing, and AI workloads.

“People outside of tech often think servers are outdated or only for legacy systems. But dedicated infrastructure still plays a critical role in compliance-heavy industries, and sometimes outperforms cloud for specific workloads," said one survey respondent.

“The biggest misconception is that we don’t need them anymore because of cloud adoption,” another respondent said. “But dedicated servers still handle our most critical operations due to reliability, control, and predictable costs.”

IT leaders eye more control with dedicated servers

More than half the IT professionals (55%) said their main reason for choosing dedicated infrastructure over cloud was full control and customization. Other reasons included network performance, physical security, predictable pricing, and custom hardware configurations.

Unfortunately, some said they faced communication challenges within their organizations, with nearly a third saying they don’t feel confident explaining infrastructure choices to non-technical leadership figures.

More than half of IT professionals (53%) said they still consider dedicated servers essential, and nearly as many (45%) believe their importance will grow even more by 2030.

However, there’s still room for improvement, with a quarter of respondents asking for easier scaling, with others looking for access to modern developer tools (15%) and sustainable energy use (14%).

"Despite predictions of cloud dominance, dedicated servers remain a foundational component of enterprise infrastructure, especially in industries where performance, control, and compliance are critical," said the researchers.

"IT professionals continue to rely on them not out of nostalgia, but because they deliver predictable, customizable environments that serve mission-critical needs."

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