IBM Dominates High-End Server Market

Despite a shrinking market, Big Blue increases its lead.

Despite a shrinking market, IBM Corp. increased its lead over rival Hewlett-Packard Co. (HP) in the high-end server market during Q2. That’s according to numbers from Gartner Inc. subsidiary Dataquest.

IBM garnered 29.6 percent of high-end server revenues, an increase of almost six percent from its Q2, 2001 showing of 27.9 percent of the market.

Big Blue’s gains came at the expense of a beleaguered HP, which in Q2 2002 netted 24.7 percent of high-end server revenues—a drop of almost 10 percent from its 2001 share of 27.4 percent.

On a comeback roll, Sun Microsystems Inc.ate into HP’s market share from the bottom, growing its slice of high-end server revenues from 16.6 percent in Q2 2001 to 18.4 percent in 2002. That’s a gain of almost 10 percent.

Thanks largely to its acquisition of Compaq Computer Corp., HP was again the market leader in terms of unit volume.

According to Gartner, IBM, HP and Sun are vying for a shrinking market. High-end server revenues for Q2 2002 plunged by 13 percent, from $11.6 billion in 2001 to $10.1 billion in 2002.

In contrast, says Jim Cassell, group vice-president of Gartner’s Dataquest research division, Q2 2002 revenues for 32-bit Intel (IA-32) servers were up by almost $1 billion over their 2001 levels. According to Cassell, a spike in shipments of servers configured with Linux is responsible for robust IA-32 sales.

"We show an up-tick of about $1 billion [in Q2 2002], and a lot of that can be attributed to Linux," he concludes.

About the Author

Stephen Swoyer is a Nashville, TN-based freelance journalist who writes about technology.