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DATE 2006-02-01

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Key: Value:

Key: Value:

MESSAGE
DATE 2006-02-23
FROM Ruben Safir
SUBJECT Subject: [NYLXS - HANGOUT] Is Free Software Losing Ground?
Windows bumps Unix as top server OS


By Stephen Shankland
http://news.com.com/Windows+bumps+Unix+as+top+server+OS/2100-1016_3-6041804.html

Story last modified Wed Feb 22 07:01:52 PST 2006

advertisement


Windows narrowly bumped Unix in 2005 to claim the top spot in server
sales for the first time, according to a new report from IDC.

Computer makers sold $17.7 billion worth of Windows servers worldwide in
2005 compared with $17.5 billion in Unix servers, IDC analyst Matthew
Eastwood said of the firm's latest Server Tracker market share report.
"It's the first time Unix was not top overall since before the Tracker
started in 1996."

And in another first, fast-growing Linux took third place, bumping
machines with IBM's mainframe operating system, z/OS. Linux server sales
grew from $4.3 billion in 2004 to $5.3 billion in 2005, while mainframes
dropped from $5.7 billion to $4.8 billion over the same period, Eastwood
said.

Servers are powerful networked machines for tasks such as handling
e-mail, financial transactions, airline reservations and file storage.
According to IDC, the overall server market grew 4.4 percent to $51.3
billion from 2004 to 2005. Another market watcher, Gartner, released
data Tuesday that largely agreed, with 4.5 percent growth to $49.5
billion.

Conventional wisdom in the 1990s forecast that Microsoft's Windows would
inexorably move to market leadership, but its arrival was slowed by
several factors. For one thing, Windows took much longer to mature than
many expected. For another, Unix--in particular Sun Microsystems'
Solaris--succeeded wildly in the dot-com spending spree. And out of the
blue came Linux, an operating system modeled after Unix but popular on
the same hardware as used by Windows--servers built with x86 processors
such as Intel's Xeon and, increasingly, Advanced Micro Devices' Opteron.

The Unix market, though, is still huge, and the three major players are
fighting for every scrap. In another first, IBM secured the top spot in
2005, with 31.8 percent of the market to Hewlett-Packard's 29.8 percent
and Sun's 26.2 percent.

"They set that out as a goal, and it does appear they achieved it,"
Eastwood said.

Sun is trying to restore Unix fortunes as well by making Solaris an
open-source project and bringing it to x86 servers. Although Sun's Unix
revenue continued to decline, dropping 10 percent to $4.6 billion in
2005 according to Gartner, Sun dominated unit shipments with 59 percent
of the 272,000 shipped.

Overall market growth
IBM led the overall market in 2005 in terms of revenue, with $16.9
billion in sales and 32.9 percent share, IDC said. But IBM's growth was
slower than the overall market, and the company lost 0.3 percentage
points of share.

Two major server companies that grew faster than the overall market: No.
2 HP, with 8.9 percent growth to $14.2 billion, and Dell, with 13.3
percent growth to $5.3 billion.

No. 4 Sun, which has been losing share of server revenue for years,
continued its declines, with revenue shrinking 4.9 percent to $4.9
billion. But its new "Galaxy" line of x86 servers and UltraSparc T1
"Niagara"-based servers could help the company in 2006, Eastwood said.

"I think Sun's pretty well-positioned this year for some growth,"
Eastwood said. In the fourth quarter of 2005, Sun's x86 server revenue
grew almost 69 percent to about $100 million, though it's still in sixth
place.

Lower-end servers
As in years past, much of the growth took place in lower-end servers
costing $25,000 or less--a category that accounted for 6.8 million of
the 7 million units shipped, Eastwood said. As these systems assume
important duties and simultaneously juggle multiple tasks through
virtualization technology, they more often are sold with large amounts
of memory and internal storage, Eastwood said.


In other news:
* Microsoft looks for 'protection' money
* Ask a question online, get an answer... sometimes
* HP Labs marks 40th with high-tech coffee table
* Nude photo site wins injunction against Google
* News.com Extra: Major League Gaming gains edge
* Sign up for News.com's Morning Dispatch and other newsletters.

"The systems and configurations going out are much richer," he said, a
fact that's slowing the decline in average selling prices that has been
typical in the computing industry.

AMD's Opteron processor made significant strides in the lower-end
market. Servers using AMD's chips accounted for 6 percent of the x86
server market in the fourth quarter of 2004, with the rest being Intel
chips, but a year later increased to 14.3 percent.

"There's real strong movement there," Eastwood said.

The lower-end server market is strategic because it's growing faster
than the overall market. For example, in the fourth quarter, x86 server
sales grew 6.7 percent to $6.8 billion while the overall server market
shrank 0.2 percent to $14.5 billion.

Another growth category is blade servers, thin models that slide
side-by-side into a chassis like books into a bookshelf. The chassis
interconnects the blades and supplies communal resources such as power
and networking hardware.

Blade server revenue grew 84 percent from $1.15 billion in 2004 to $2.11
billion in 2005. Meanwhile, blades themselves got more powerful and
their average price rose from $3,750 to $4,200 during the same period,
he added.

IBM continues to lead the blade market with 40.9 percent of sales. HP is
in second place with 34.5 percent, while Dell trails in third at 10.1
percent.


Copyright ©1995-2006 CNET Networks, Inc. All rights reserved.



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