Despite increasing pressure from Linux, Microsoft dominated the worldwide market in 2002 for operating systems used on servers and, less surprisingly, the operating system market on the client side. It will continue to defend its market position for at least the next four years, according to a research report released Wednesday by IDC.Despite increasing pressure from\u00a0Linux, Microsoft dominated the worldwide market in 2002 for operating systems used on servers and, less surprisingly, the\u00a0operating system\u00a0market on the client side. It will continue to defend its market position for at least the next four years, according to a research report released Wednesday by IDC.Microsoft's Windows accounted for 55.1% of new shipments of server operating systems in 2002, up from 50.5% in 2001, while paid versions of Linux accounted for 23.1% of new shipments in 2002, up from 22.4% in 2002, the Framingham, Mass., market research company said in its report "Worldwide Client and Server Operating Environment Market Forecast and Analysis, 2002-2007."The IDC report did not take into account the free versions of Linux available.According to the report, license shipments by Microsoft, on the client side, increased to 93.8% of the worldwide market in 2002, up from 93.2% in 2001. In 2002, paid Linux client license shipments accounted for 2.8% of the market total. Combined, vendors generated nearly $10.4 billion in client operating environment (COE)\u00a0sales in 2002, IDC said.Microsoft's volume licensing programs, aimed at converting its customers to long-term volume licensing plans, have and will continue to play a large part in increasing the Redmond, Wash., software company's share of the COE market, IDC said.The Mac OS, from Apple, accounted for 2.2% of the COE market in 2002, to take the second place position after Microsoft. By 2004, the Mac OS will concede that place to Linux, IDC forecasted.On the server side, which IDC defined as the server operating environment (SOE) market, there were 5.7 million new license shipments in 2002, an overall decline of 5.1% compared to 2001, with sales of $7.8 billion in 2002, IDC said.Between 2001 and 2002, only operating system server software from Microsoft and Linux experienced market growth. The gains were 8.6% and 17.2% respectively, giving Microsoft a 16.7% share of the SOE market in terms of revenue and Linux a 0.6% share. Combined, all companies selling Unix server software earned 31.1% of 2002 market revenue (a decline of 8.9% from 2001), while Novell's NetWare software carved out 4.3% (a decline of 12.4%), IDC said.About 47% of revenue in the SOE market, or $3.7 billion, came from sales of mainframes, midrange computers and other large host-centric operating environments, the report said.But sales of operating system sever software running over mainframes and other large systems declined sharply when comparing 2002 to 2001. According to IDC estimates, vendors shipped 50,000 copies of these large datacenter SOEs in 2002, a decline of 58% over 2001.IDC attributed the decline to the phasing-out of older network operating systems such as OS\/2 from IBM. IBM has said that it will end support of its aging OS\/2 operating system after 2006, and has recommended that OS\/2 customers migrate to Linux rather than Windows.It is this support of Linux from large systems vendors,\u00a0IBM\u00a0in particular but also\u00a0HP\u00a0and\u00a0Sun, that will propel Linux in the SOE market, as the large vendors have the capital and the will to refine the Linux software and market it, IDC said.The report singled out\u00a0The SCO Group's copyright infringement lawsuit against IBM as "the only dark clouds on the Linux horizon," though IDC said it does not foresee the litigation as having the ability to cripple the Linux market as it currently stands."Even if the litigation is resolved, the incident may forever put to rest the notion that Linux is 'free' software that can be deployed on any machine without any accountability for ownership and licensing," IDC said in the report. "This weakens a major area of differentiation between Linux and more commercialized operating environments."IDC predicted that the litigation "will be resolved in such a way that Linux can continue on in the current source tree." At worst, should a court side with SCO, "the offending code will be removed and replaced by the open source developer community without any significant setback in the functionality, reliability, and scalability of the Linux kernel."IDC projected that Linux platform revenue will increase at more than four times the overall industry average for all platforms through 2007. In the SOE market, paid Linux\u00a0operating system\u00a0software will comprise 32.3% of all server shipments by 2007, IDC forecasted, with 2.8 million new Linux paid SOEs being shipped each year.Regardless of the market gains made by Linux, its revenue is dwarfed by Microsoft's earning power, IDC said. Microsoft generates about the same amount of operating system revenue in three days as the entire Linux industry generates in one year, IDC said.IDC said the research for the report was based on its standard methodology using data sources from hundreds of IDC interviews, product briefings, press releases, vendor financial statements and related filings.The authors of the report, Al Gillen and Dan Kusnetzky, could not immediately be reached for comment.