Sun Shines on Oracle as Server Market Rebounds

By Sean Kerner (Send Email)
Posted May 25, 2011


The global market for servers is getting healthier according to new data from research firm IDC. IDC reports 'meaningful' enterprise server refresh cycle as first quarter server revenues hit $11.9 billion

According to IDC's first quarter 2011 Worldwide Quarterly Server Tracker, global server revenues hit $11.9 billion for a 12.1 percent year-over-year increase. Revenues grew on the strength of increased server unit shipments of 1.9 million units. IDC noted that the 1Q11 server shipments numbers were the second highest quarterly total ever reported in the first calendar quarter of any year.

Server growth is coming from volume, midrange enterprise, and high-end enterprise servers which is the first time in two years that all server segments have reported quarterly revenue gains on a year-over year basis.

"Meaningful enterprise infrastructure refresh occurred across all geographies in the quarter," said Matt Eastwood, group vice president, Enterprise Platforms at IDC in a statement.

In terms of vendor share, HP tops IDC's list with 31.5 percent of the total revenue share for the first quarter. HP (NYSE: HPQ) grew its revenues by 10.8 percent during the quarter on the strength of both Itanium and x86-based servers. During the quarter HP once again affirmed its commitment to Itanium, as Oracle claimed that Intel was abandoning it.

Coming in at No. 2 two was IBM (NYSE: IBM ) with 29.2 percent market share on the strength of a 22.1 percent revenue gain during the quarter. Dell (NASDAQ:DELL) came in third with 15.6 percent revenue market share after posting a year-over-year revenue gain of 9.7 percent.

After a year of selling Sun servers, Oracle's server revenues grew by 13.6 percent on the health of Sun SPARC server demand. Overall Oracle (NASDAQ:ORCL) held down the fourth spot on IDC's vendor list with 6.5 percent revenue share.

Linux and Unix Grow

The first quarter of 2011 was also another solid period of growth for Linux servers. Linux now holds 16.9 percent of global server revenues after growing 16.9 percent during the quarter. Total Linux server revenues for Q1 were reported at $2.0 billion. IDC noted that Linux growth has now increased for the last six consecutive quarters.

Unix also grew for the time in 11 quarters with $2.6 billion in revenues for a 12.5 percent year-over-year gain.

"This segment was hard-hit in 2009 and 2010 during the economic downturn as customers deferred or delayed acquisition of midrange and high-end Unix servers," said Jean S. Bozman, research vice president, Enterprise Servers at IDC in a statement. "There is also continuing competition for enterprise workloads with non-Unix platforms. However, as IDC projected, there has been a return to growth in this segment in 2011, as customers' servers are being refreshed to carry forward Unix-specific, mission-critical workloads."

Sean Michael Kerner is a senior editor at InternetNews.com, the news service of Internet.com, the network for technology professionals.

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Tags: Oracle, IBM, Dell, HP, IDC

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