Aug 27, 2008 (01:08 PM EDT)
Dell, IBM Revenue Growth Double Overall Server Market

Read the Original Article at InformationWeek

Dell and IBM were big winners in the global server market in the second quarter, with revenue growth rates that more than doubled those of the overall market, a research firm said Wednesday.

The overall market recorded its ninth consecutive quarter of positive revenue growth, increasing sales by 6.4% over the same period a year ago to $13.9 billion, according to IDC. Revenue was the highest for a second quarter since 2000.

No. 1 IBM and third-place Dell did particularly well among the top five vendors, increasing revenue by 13.8% and 14.1%, respectively. IBM revenue topped $4.6 billion, and Dell took in $1.7 billion, IDC said.

IBM, which had a 33.2% market share in the quarter, did well primarily because of a solid performance from its System z mainframe and System p Unix servers, IDC said. Revenue from System z running z/OS grew 31.7% year over year to $1.6 billion. Within the Unix server market, IBM increased revenue nearly 25.7%.

Dell's strong quarter boosted its overall market share by nearly 1 percentage point year over year to 12.5%. Dell had the strongest revenue growth in x86 servers among the top five vendors, ending the quarter with a 24.7% market share.

Hewlett-Packard, however, remained the leader among x86 vendors with a 33.9% market share. In the overall server market, HP held on to the overall No. 2 spot with a 27.4% share. HP increased revenue by 3.1%.

Rounding out the top five were fourth-place Sun Microsystems, which saw a 7.2% drop in revenue, and Fujitsu/Fujitsu Siemens, which saw its revenue fall by 2%.

The overall market was boosted by a sustained refresh cycle and an expansion of infrastructures across large companies, small and medium-sized businesses, and cloud-computing environments, IDC said.

Customers around the globe continued to deploy a wide range of technologies, IDC said, noting that it saw strong growth in blades, Unix systems, and IBM mainframes.

"Diversity in market demand demonstrates customers do not believe a single standardized infrastructure is capable of meeting all their computing needs," IDC analyst Matt Eastwood said.

IDC rival Gartner last week reported overall server revenue for the second quarter grew 5.7% to $13.8 billion, and shipments increased more than 12% to 2.3 million units.