Linux server market breaks new ground

Linux was the leading light in a worldwide server market that grew 5.1 per cent to $14.4 billion in the fourth quarter of 2004, research has indicated. According to IDC's latest Worldwide Quarterly Server Tracker, sales of Linux servers have been accelerating rapidly with 60 per cent annual growth over the last year.

Linux servers generated $1.3 billion in quarterly revenue, representing 9.0 per cent of worldwide server revenue. It was also the second sequential quarter of $1 billion-plus quarterly revenue. Overall, Linux server revenue was found to have grown 35.6 per cent year over year, while unit shipments grew 29.1 per cent year over year.

HP led the Linux server market with 26 per cent revenue share, followed by IBM and Dell with 23.5 per cent and 15.8 per cent share, respectively. "Linux server revenue continues to break new ground," said Jean S. Bozman, research vice president in IDC's Worldwide Server Group.

"This reflects increasing adoption of Linux servers for a broader range of workloads, spanning high performance computing and enterprise workloads, including IT infrastructure and Web infrastructure as well as collaborative, decision support, and business processing workloads."

According to the analyst firm, for the full year 2004, worldwide server revenue grew 6.2 per cent to $49.0 billion, while worldwide unit shipments grew 19.3 per cent to 6.3 million units. IBM led the overall server market in 2004 with 33.3 per cent revenue share, followed by HP with 26.6 per cent share.

The research reveals that the volume server segment (servers priced less than $25,000) was the only market segment that experienced revenue growth in 4Q04, while midrange enterprise servers ($25,000 to $499,999) and high-end enterprise servers ($500,000 or more) showed declining revenue.

"Volume servers are being deployed in rich configurations, and in scale-out cluster configurations, to take on a wider range of enterprise workloads," said Matthew Eastwood, program vice president of IDC's Worldwide Server Group.

"This trend towards modularization shows that customers are also increasingly embracing blade computing and both scale-out and scale-up server virtualization technologies as they refresh and expand their IT infrastructures."

The x86 server market continued to experience strong growth, with revenue of $6.3 billion worldwide for the fourth quarter of 2004. Factory revenue for x86 servers grew 14.4 per cent, while unit shipments grew 16.8 per cent to 1.6 million servers.

"Nearly 25 per cent of all x86 servers shipping today include 64-bit support in the form of AMD Opteron and Intel EM64T processors," said John Humphreys, research manager, Modular Server Solutions at IDC.

"This trend will boost the use of x86 servers in high performance computing (HPC) technical workloads and in some enterprise workloads that formerly required the use of 64-bit RISC platforms."