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Virtualization Mania Helps Servers Cautiously Up Worldwide

SYS-CON writes:

IDC says the worldwide server market grew 0.5% year-over-year to $13.1 billion in Q3.

It's the highest Q3 server revenue since 2000 but the slowest growth rate since 1Q06.

Unit shipments grew 6.3%, a slight decrease over the 7.8% year-over-year growth reported in 3Q06.

Volume systems revenue growth improved to 8.1% year-over-year, the second-highest growth rate in the segment in the past eight quarters.

In the mid-range, despite growth in Windows servers, Linux servers, and Unix servers, revenue from mid-range enterprise servers declined 2.2% year-over-year, a second consecutive decrease.

Revenue for high-end enterprise servers declined 14.5% year-over-year, the largest decline in year-over-year spending growth in more than five years.

IDC says, "Concerns about the economy, particularly in the US, are causing customers to re-think their infrastructure needs at the same time that new levels of compute and power densities are expanding power and cooling challenges and driving different IT infrastructure acquisition patterns in the market. IDC believes that we are in the early stages of a market-wide transition, which will require significant IT investment in a more flexible IT fabric; however, concerns among buyers about an economic slowdown could slow investment in new systems somewhat."

IBM lost market share because of weakness in System z and System i, but maintained its number 1 spot worldwide server systems market, with 30.0% of the factory revenue.

Seems that after five consecutive quarters of positive growth, revenue from IBM's z/OS-run System z servers nose-dived 31.9% compared to last year.

IDC attributes it to delayed spending in anticipation of a new family of systems to be introduced soon.

HP grew server revenue 10.3% year-over-year and retained the number 2 spot with 28.6% of the factory revenue. Both ProLiant and Integrity brands performed well. HP captured 32.4% of total units shipped, more than Dell, IBM and Sun.

Dell had 13.5% revenue growth and kept its third place with 12.1% market share.

Sun maintained its fourth place position, posting 0.9% year-over-year growth. It's deemed to have 10.2% market share.

Windows server revenue was $5.3 billion, up 9.7% year-over-year and gaining 4.8 points of revenue market share. Windows servers accounted for 40.4% of all server revenue in Q3.

Linux servers posted a fifth consecutive quarter of double-digit growth, with year-over-year revenue growth of 10.7% for a total of $1.8 billion. They now represent 13.4% of all server revenue. HP claims a gain of 4.7% in revenue having grown revenues 26.6% and units 31.1% and remains the worldwide Linux server leader.

Unix servers had 4.1% revenue growth coming from both the volume and mid-range enterprise segment.

IDC says Unix servers did particularly well in the high-end enterprise segment of the market, where revenue grew 9.3%.

Worldwide Unix revenues worked out to $4.1 billion for the quarter, 31.1% of quarter's server spend, and IBM got the lead in revenue with a 31.9% share. HP grew its factory revenue 9.8% and unit shipments by 28.5%.

According to IDC, "Unix servers continue to be important platforms for mission-critical workloads, with advanced management capabilities and high RAS levels built into the server hardware. This level of investment in the third quarter - traditionally a slower quarter for Unix servers than the end-of-year fourth quarter - is a sign that businesses continue to place value on Unix servers, and are retaining them to run important custom and ISV applications."

x86 server revenue was up 9.1% year-over-year to $7.2 billion, the second-highest quarterly total ever reported. Unit shipments grew 7.8% to 1.9 million servers. IDC says all major server OEMs grew x86 factory revenue in the quarter, with HP leading the market with 33.3% of the x86 revenues and Dell in second place with 21.8%.

The server blade market accelerated for the fourth consecutive quarter, with factory revenue growing a hefty 41.4% year-over-year. Overall, bladed servers, including x86, EPIC and RISC blades, surpassed $1 billion for the first time in a single quarter and represented 7.9% of all server market revenue in the quarter.

HP kept the number 1 spot with 42.1% market share and factory revenues up a whopping 79.6% year-over-year. IBM held the number 2 position with 32.9%, growing factory revenue only 6.5% and losing 10.9 points of revenue market share year-over-year.

IDC said, "Server blades remain the fastest-growing segment and for the first time accounted for over 10% of all servers shipped. The competitive space will only prove to become more interesting as vendors continue to roll out new blade initiatives, including virtual I/O solutions and chassis targeted to small-medium business sites."

Read the original article from SYS-CON, here.

Published Sunday, December 02, 2007 12:14 PM by David Marshall
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