Linux server market share keeps growing

. . . keeping an eye on the penguin

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May 29, 2007

The server market is back, and Linux is helping, IDC reports. Linux servers posted their second consecutive quarter of double-digit growth and now represent 12.7 percent of the overall server market, or $1.6 billion for the first quarter of 2007.

The latest quarter was a good one for servers in general. Factory revenue in the worldwide server market grew 4.9 percent year-over-year, to $12.4 billion for the latest quarter. This is the fourth consecutive quarter of positive revenue growth and the highest Q1 server revenue since 2001, IDC said.

"The server market continues to experience solid growth as businesses of all types look to enhanced IT capabilities in order to help drive additional business efficiency, improved customer satisfaction, and accelerated revenue growth," said Matt Eastwood, IDC's program VP of enterprise platforms in a statement.

Microsoft's Server 2003 showed surprising strength. Microsoft Windows server revenue was $4.8 billion in Q1, showing 10.4 percent year-over-year growth and gaining 1.9 points of revenue market share over Q1 of 2006. According to IDC, this was the first quarter since IDC began tracking Linux server spending in 1998 that Windows server revenue has grown faster than Linux server revenue. Windows comprised 38.8 percent of all server revenue in Q1 of 2007.

That may be in part because the x86 architecture is continuing to accelerate. In the last quarter, it grew 8.7 percent year-over-year to $6.6 billion worldwide, its fastest growth rate in six quarters, IDC said.

Unit shipment growth also continued, with a moderate gain of 6.5 percent to 1.8 million servers as IT consolidation activities continue across the market, according to IDC. HP and Sun were the only top-five server vendors to outgrow the market in Q1 -- growing factory revenue 18.1 percent and 39.5 percent respectively -- and gaining x86 market share in the process. HP led the market with 35.3 percent x86 revenue share with Dell holding second place with 20.4 percent revenue share.

"For the third consecutive quarter x86 revenue growth rates increased while average selling prices have held steady," said Jed Scaramella, research analyst in IDC's Enterprise Computing group in a statement. "As customers continue to virtualize their IT environments, they require more richly configured server systems. While unit shipment growth rates continue to slow, the increased amounts of memory and I/O necessary for virtualization have driven revenue growth rates."

Linux has recently shown several advances in virtualization. These have included a new release of the open-source Xen hypervisor, and the incorporation of the OpenVZ virtualization software into the Linux kernel, as of the 2.6.20 kernel. This should position Linux well in the fast growing server virtualization market.

The data comes from IDC's "Worldwide Quarterly Server Tracker."

-- Steven J. Vaughan-Nichols

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Use of this site is governed by our Terms of Service and Privacy Policy. Except where otherwise specified, the contents of this site are copyright © 1999-2009 Ziff Davis Enterprise Holdings Inc. All Rights Reserved. Reproduction in whole or in part in any form or medium without express written permission of Ziff Davis Enterprise is prohibited. Linux is a registered trademark of Linus Torvalds. All other marks are the property of their respective owners.