Shipments of servers powered by x86 processors will not grow as fast as previously forecasted, but x86 will remain the dominant chip design, IDC said in a report Tuesday.

The market researcher has scaled back unit growth forecasts for x86-based servers, citing the market transition to multicore processors and demand for virtualization. Both technologies give servers more computing power, thereby reducing demand for new servers.

IDC forecasts that worldwide unit demand for x86 servers will grow by just 39 percent between 2006 and 2010, down from an earlier forecast of 61 percent. This means that IDC has trimmed 4.5 million unit shipments and US$2.4 billion in revenue from its forecast for 2006 to 2010.

But by no means is the x86 fading away. It is expected to actually grow its unit market share to 94 percent in 2011 from 93 percent in 2006.

"Definitely, the x86 remains the growth engine of the market, but the way customers are spending their money there is shifting," said Michelle Bailey, research vice president for IDC's Enterprise Platforms and Datacenter Trends.

Alternatives to the x86, such as the EPIC (explicitly parallel instruction computing) architecture in Itanium processors from Intel Corp. and Hewlett-Packard Co., RISC (reduced instruction set computer) architecture in Sun Microsystems' Sparc and IBM Corp.'s Power processors and the CISC (complex instruction set computer) architecture in mainframe computers, will remain also-rans to the dominant x86.

Based on revenue, the x86 enjoyed 50 percent market share in 2006, Bailey said. By 2011, x86 will grow its revenue market share to 56 percent.

Virtualization is technology that allows a server to run multiple operating systems and software applications simultaneously, so a business can run on one server programs it previously would run on, say, four servers. Virtualization aids in the consolidation of server deployments by an average ratio of 5:1, said Bailey. And as chip makers develop dual-core or quad-core processors, customers can get even more work out of fewer servers.

"The intersection of the two is what's really having the impact on the market," she said.

The two top server vendors are confident they'll succeed in this shifting market.

"It may reduce the count, but the systems that you do sell become richer configurations because memory has to go up to match the processor capability [and] the input/output has to go up to match the memory and the processor," said Rob Sauerwalt, global business manager for System x servers at IBM.

The IDG News Service is a Network World affiliate.