Resellers need to change their strategy if they are to survive the changing server market, according to Marc Andreessen, one of the founders of the internet.
Addressing the Cal-IT conference in London, Andreesen said although server sales are showing growth, a few big manufacturers will dominate and cut margins - as has happened in the PC industry.
"The reseller margins on hardware were tough enough 10 years ago, let alone now," he said.
But a huge new market in web applications and open source development is opening up to resellers and VARs.
"Companies are going to have to learn new tricks in order to survive. There's also a huge base of computer science graduates coming onto the market with intimate knowledge of Linux and Java," he said.
Andreesen pointed to the rapid growth of Linux in the server market where, in the last five years, the number of servers running Linux has leapt from zero to 35 per cent.
At the same time server numbers have increased rapidly. In 1950 there were five servers in the US, a number which had risen to 500,000 in 1995 and now tops over 5 million.
But Peter Dawes, managing director of systems integrator Linux IT, said: "Personally I think developing apps yourself is a waste of time. We're a professional system integrator and we'd outsource the development work.
"People coming out of universities do have those skills but it's difficult to see graduates driving the market. That may come five or so years down the line when they are specifying company systems."
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