Peeling back the layers


Servers and PCs are the bread and milk of the IT household. Even in slow times, they’re going to be bought in relatively big numbers. Their sales numbers often act as a bellwether for the entire industry.

IDC recently tallied up the server market for the second quarter of 2003, and while the numbers in and of themselves are interesting, the stories behind them also paint an interesting picture.

See our story on page 4 for all the details, but the bottom line is that while server sales are still nowhere near historic highs, and are down 3.6 per cent in Q2, activity is picking up. But not all servers are selling equally.

RISC servers, for instance, are not selling nearly as well as the so-called “volume” server, a category that includes boxes under US$25,000, primarily the blade and rack-mounted units.

So, if viewed only in this admittedly narrow light, the strategic decision Hewlett-Packard made a few years back to convince its large RISC installed base to move to Wintel would appear to be a wise one. But officials at HP, if they pay attention to such numbers, must have some rather mixed feelings when looking at the IDC results. According to the research firm, IBM finished in top spot in overall sales with a 30.4 per cent market share. That position was formerly held by HP. Keep in mind, this is actually two companies finishing second to IBM, and that one of the key reasons for the HP-Compaq merger was to bulk up so as to better compete with Big Blue.

However, IDC did find that HP held on to the lead when it comes to Windows and Linux server sales. Given the OS landscape, and that the sales of Windows units jumped substantially in Q2, that would be encouraging news for HP in the long-term.

So viewed in this context, and although its Intel-based sales did rise, IBM doesn’t look quite so secure.

And what of Sun Microsystems? Its overall share and revenues dropped, although it’s now sitting atop the Unix server market, edging out HP. But in this landscape, what does sitting atop the Unix market mean? And what of its relatively arms-length relationship with Linux?

These shifts are proof positive of the underlying user patterns. For the first time since its birth, observers say Unix may now be in a state of decline within corporate IT departments, relenting under the competitive pressure of less costly and increasingly beefier Windows and Linux. Thus, the trend that’s already underway of subtly distancing themselves from RISC is likely permanent.

Of course, a few percentage points in a single quarter hardly tells a complete picture, and numbers can be painted any which way. But rest assured there is a shakeout in the server space. It’s just that this one is occurring in slow motion.

Would you recommend this article?


Thanks for taking the time to let us know what you think of this article!
We'd love to hear your opinion about this or any other story you read in our publication.

Jim Love, Chief Content Officer, IT World Canada

Featured Download

Featured Articles

Empowering the hybrid workforce: how technology can build a better employee experience

Across the country, employees from organizations of all sizes expect flexibility...

What’s behind the best customer experience: How to make it real for your business

The best customer experience – the kind that builds businesses and...

Overcoming the obstacles to optimized operations

Network-driven optimization is a top priority for many Canadian business leaders...

Thriving amid Canada’s tech talent shortage

With today’s tight labour market, rising customer demands, fast-evolving cyber threats...

Staying protected and compliant in an evolving IT landscape

Canadian businesses have changed remarkably and quickly over the last few...

Related Tech News

Tech Jobs

Our experienced team of journalists and bloggers bring you engaging in-depth interviews, videos and content targeted to IT professionals and line-of-business executives.

Tech Companies Hiring Right Now