Linux drives worldwide server sales boom

Huge demand for Linux servers has help push the overall server market to new heights, according to IDC's Worldwide Quarterly Server Tracker.

Factory revenue in the worldwide server market grew at 5.3 per cent year over year to $12.1bn in the first quarter of 2005, marking the eighth consecutive quarter of positive overall revenue growth.

Linux server sales enjoyed their eleventh consecutive quarter of double-digit growth, with year-over-year revenue growth of 35.2 per cent and unit shipments up 31.1 per cent.

The study noted that customers continue to expand the role of Linux servers into an ever increasing array of workloads in both the commercial and technical segments of the market.

Sales of Windows servers enjoyed strong growth, as revenues and unit shipments grew 12.3 per cent and 10.7 per cent respectively year over year.

Significantly, quarterly revenue of $4.2bn for Windows servers represented 34.4 per cent of overall quarterly factory revenue, for the first time pulling even with quarterly revenue in the Unix server market.

Unix servers experienced 2.8 per cent revenue growth year over year and five per cent unit shipment growth over the first quarter of 2004.

IDC found that volume server revenue grew 15.6 per cent year over year and continues to represent the primary growth engine for the server market overall.

Revenue for midrange enterprise servers grew 6.1 per cent year over year, marking the second consecutive quarterly increase in that segment.

IDC believes this may reflect increased IT spending to run more scalable workloads and consolidation/virtualisation initiatives than can be deployed onto volume servers.

However, this growth of low- and mid-range server shipments was not maintained across high-end devices.

The enterprise server market, which grew from the fourth quarter of 2003 through the third quarter of 2004, declined 13.9 per cent year over year, its second consecutive quarter of reduced spending.

IDC speculated that one factor in this drop could be continued price compression, which reduces average sales prices for servers from the high-end enterprise into the midrange enterprise space.

"While the market is not accelerating at the same pace that it did in 2004, IT spending remained strong in the first quarter as customers continued to invest in new infrastructure," said Matt Eastwood, programme vice president of worldwide server research at IDC.

"Although scale-out computing continues to gain favour with customers for an increasing variety of workloads, increased spending for midrange enterprise systems indicates that other form factors continue to be attractive for large, monolithic applications and for consolidation workloads."

In terms of manufacturers IDC's research found that IBM held on to its top ranking as HP moved into a statistical tie for number one in the worldwide server systems market with 28.3 per cent and 27.6 per cent factory revenue share respectively.

Dell and Sun tied for third place in factory revenue with 10.8 per cent and 9.9 per cent share respectively.

In terms of unit shipments, HP maintained its number one position worldwide with 30.4 per cent server shipment share.

Dell maintained the number two spot in terms of worldwide server shipments with 24.5 per cent share, growing shipments 17.4 per cent compared to the first quarter of 2004.

See also:

Servers have to get along together

IT managers increasingly wanting interoperable products, not particular brands  01 Jun 2005

HP and Dell shine in server market

Sun struggling to keep up  27 May 2005

Open source

Linux is becoming the operating system of choice for an increasing number of corporates, and even the mighty Microsoft is acknowledging the threat ...  12 May 2004

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