IDC Server Stats Show a Market in Decline, IBM in the Lead

IDC”s latest crop of server stats for 2001 shows IBM leading the charge in a worldwide server market on the decline.

IDC”s findings reveal that revenue in the server market decreased 26 percent in the fourth quarter of 2001, from $16.9 billion in 4Q00 to $12.6 billion in 4Q01. Unit shipments declined 7 percent to 1.143 million units in 4Q01, according to the market research firm.

IDC’s latest crop of server stats for 2001 shows IBM leading the charge in a worldwide server market on the decline.

“Despite the decline in revenue and shipment for the quarter, there are some flames beginning to kindle the market,” said Vernon Turner, IDC”s group vice president of Global Enterprise Server solutions.

“When comparing the decline rate with the previous quarter, there are indications that the server market has bottomed out and that it will return to its average seasonal trends in 2002,” Turner added.

IDC believes that the current competition for the number one spot in the Unix market will continue, and 2001 saw a positioning shift among the top players. Fourth quarter 2001 was the first time since 4Q98 that IBM took the top spot for worldwide Unix market share.
Big Blue”s 26.9 market share gave it a marginal edge over Sun Microsystems” 26.8 percent. Hewlett-Packard ended the quarter close behind with 25 percent market share.

The vendors with the greatest market share in the worldwide market, based on revenue, in 4Q01 were IBM (with 32 percent), Compaq (with 17 percent), HP (with 14 percent), Sun (with 12 percent), and Dell (with 7 percent).

According to IDC, the high-end server market declined about 4 percent from $3.3 billion in 4Q00 to $3.17 billion in 4Q01. The high-end market dropped 9.4 percent from $13.1 billion in 2000 to $11.9 billion in 2001.

Steve Josselyn, research director, Enterprise Server Fundamentals program, noted, “These declines are significant, but the high-end market was buoyed for much of the year by steady increases from IBM”s new zSeries family in its first full year of shipments. These increases offset declines for most other high-end platforms.”

For full-year 2001, the top-five server vendors worldwide, again on a revenue basis, were IBM (with 28 percent), Compaq (with 16 percent), HP (with 14.4 percent), Sun (with 13.8 percent), and Dell (with 7 percent).

Other points that IDC noted:

• In 2001, factory revenue declined 19 percent to $49.8 billion; unit shipments declined 2 percent.
• Linux surpassed NetWare to become the second largest operating system used for new Intel-based server deployments.
• Rack-optimized servers comprised 34 percent of all servers sold in 2001.
• Regions around the world weathered the server market decline differently. For example, China-based assembler, Legend Computer became the tenth largest supplier of server hardware shipments worldwide in 4Q01.

IDC”s Worldwide Quarterly Server Tracker compiled the data. The Tracker is a quantitative tool for analyzing the global server market on a quarterly basis. It includes quarterly shipments (ISS and upgrades) and revenue (customer and factory), segmented by vendor, family, model, region, operating system, price band, CPU type, and architecture.

The Tracker is available for purchase from Hoang Nguyen at +1 508 935 4718 or hnguyen@idc.com.

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