The endless story of “Who’s the top dog in server-ville” entered a new chapter this week as new stats from analyst firm IDC place IBM at the head of the pack. The company is now enjoying a 30.4 percent share of the $10.6 billion worldwide server market.
The report issued Friday as part of the Framingham, Mass.-based analyst group’s Worldwide Quarterly Server Tracker focused on Q2 of 2003. The findings? The Armonk, N.Y.-based computer giant supplanted last quarter’s leader — Hewlett-Packard — gaining just over 10 percent in server sales in the last three months to $32 billion.
HP, which had gained the number 1 spot in 1Q 03 on the strength of its year-old merger with Compaq, fell to second place with server sales growing 0.4 percent to $2.9 billion. However, HP retained its lead in factory revenue in the Linux server and Windows server market segments.
Dell filled in the number 4 spot with a 10 percent increase in sales to $980 million, followed by Fujitsu Siemens in the number 5 spot with 2.7 percent growth at $286 million.
Only third-place Sun Microsystems lost revenue in the second quarter by 18.7 percent to $1.4 billion. The sting is especially hard for the Santa Clara, Calif.-based network computer maker as IDC noted IBM grew 20.4 percent year-to-year in the UNIX Server market taking 5.2 points away from Sun. One bright spot for Sun though is that according to the stats, the company still remains the top UNIX-based vendor with 33 percent market share in a $4.33 billion market.
The report also showed server sales halted a downward skid in year-on-year growth in the second quarter for the first time in nine-quarters.
“The fact that this nine-quarter decline in worldwide server revenues has finally come to a halt could signal that IT managers are once again investing in IT infrastructure build-out on a worldwide basis,” said Jean Bozman, research vice president of Global Enterprise Server Solutions at IDC. “Although it’s too soon to declare a rebound in the server market, it looks like new IT buying patterns are overtaking old ones.”
The stats are also interesting in that they show the x86 server market (comprising systems based on Intel and AMD microprocessors) grew at a faster rate (more than 21 percent year-over-year in terms of unit shipments and grew 9 percent) than RISC-based ones.
IDC says the trend is partly due to the influx of x86 servers priced less than $25,000 as well as momentum in worldwide small and medium business segments, demand in departmental and workgroup environments in larger enterprises, and slow, but steady replacement of servers purchased in the 1999 and 2000 timeframe.
That data favors IBM whose Intel revenue gained 23.3 percent year-to-year with a 1.8 points share gain, while HP and Dell lost share year to year in the Intel breakdown.
The changing of the guard could not come at a worse time for HP, which posted what is being characterized as “disappointing numbers” for its third quarter 2003 earnings. HP said its Enterprise Systems Group had a rough quarter with $3.71 billion in revenues.
In other areas, IDC said sales of server blades reached a new high watermark at more than $100 million worldwide and Linux server platforms posted nearly a 40 percent increase in revenues to $650 million from the year-ago quarter. Unit shipments for Linux servers grew 42 percent during 2Q03 – faster than in any other server- market segment.
“Rack-optimized servers and server blades used in clusters and server farms are increasingly being deployed in the datacenter as effective alternatives to larger, RISC-based solutions”, said Mark Melenovsky, research director of Global Enterprise Server Solutions at IDC. “This trend is especially true for Internet infrastructure workloads, for highly parallelized technical applications and for custom applications in the high performance technical computing market, as well as in some select vertical markets, such as financial services.”
The Windows server market continued to dominate growing at 21.7 percent, compared to the year- ago quarter. Windows servers accounted for $3.1 billion of the total sever systems market revenue during 2Q 03.
