Server market grows after years of stagnant sales

IBM holds the top spot in server market share, followed by HP, according to new figures from IDC

The server market is taking off again after three years of slowing growth, says research firm IDC.

According to IDC’s quarterly report, the server market grew 6.3% year-over-year to $13.1 billion for the second quarter of 2007. The firm attributes this growth to users refreshing the servers used in their data centers and to expanded distributed-workload deployments.

Servers priced at under $25,000 sustained the largest growth -- at 11% year-over-year -- while growth of midrange enterprise servers (costing $25,000 to $499,000) grew by .2%, and high-end enterprise servers (costing more than $500,000) showed a 1.7% increase.

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The server market is taking off again after three years of slowing growth, says research firm IDC.

According to IDC’s quarterly report, the server market grew 6.3% year-over-year to $13.1 billion for the second quarter of 2007. The firm attributes this growth to users refreshing the servers used in their data centers and to expanded distributed-workload deployments.

Servers priced at under $25,000 sustained the largest growth -- at 11% year-over-year -- while growth of midrange enterprise servers (costing $25,000 to $499,000) grew by .2%, and high-end enterprise servers (costing more than $500,000) showed a 1.7% increase.

IBM led the server market with a 31% revenue share, followed by HP with a market share of more than 28%. Sales of IBM’s System x, System z and System p servers accounted for the majority of the company’s server revenue, while HP’s growth could be attributed to ProLiant and BladeSystem servers, IDC says. IBM mainframes running the z/OS operating system accounted for 9.5% of all server revenue in the second quarter.

Sun's server revenue grew 5.6% year-over-year; the company is the No. 3 player with 13.1% of the market.  Dell, which showed more than a 20% revenue growth in x86 servers, follows Sun.

On the operating system front, Linux servers represented 13.6% of server revenue. Microsoft Windows accounted for 38.2% of server revenue, and Unix system revenue tallied in at 31.7% of the market.

In x86-based servers, HP led the market with a market share of more than 35%, followed by Dell with more than 22%, then IBM with a 17.5% share.

The blade-server market also soared, with revenue growing 36.7% year-over-year. Blade servers accounted for $875 million, or 6.5% of the server market. HP held more than 47% of the blade-server market, followed by IBM with 32.3%.

Read more about data center in Network World's Data Center section.