Worldwide Market for Servers Shrank 23 Percent
(But Intel is doing relatively well).
dailynews.yahoo.com
SAN FRANCISCO (Reuters) - The global market for powerful server computers contracted by 23.4 percent in the third quarter compared to a year earlier, and International Business Machines Corp. (NYSE:IBM - news) widened its lead on competitors, data from Gartner Dataquest research showed on Friday.
Makers of the computers which run corporate networks and the Internet have said the economic downturn nearly has stopped corporate technology buying in its tracks, while many of the Internet dot-coms that fueled last year's growth have failed.
Worldwide server sales fell to $10.8 billion, from $14.1 billion a year ago and dropped 6.5 percent, from $11.6 billion in the second quarter, the closely watched Dataquest numbers obtained by Reuters showed.
U.S. sales dropped 29.4 percent from the previous year and 9.0 percent from the previous quarter, to $3.9 billion in the third quarter.
Sales of computers running Unix (news - web sites), the most popular high-end operating system, recently have dropped faster than the overall market, while lower-end systems with Intel Corp. (Nasdaq:INTC - news) chips, which typically run Microsoft Corp. (Nasdaq:MSFT - news) Windows or the free Linux (news - web sites) software, were doing relatively well.
Unix vendors like leader Sun Microsystems Inc. (Nasdaq:SUNW - news), which was one of the hardest hit when the dot-com bubble burst last year, have redoubled efforts to ward off the Windows systems, which are popular for lighter tasks.
Sales of servers with Intel chips fell 3.1 percent quarter-on-quarter to $4.0 billion while Unix revenue dropped 15.5 percent to $4.6 billion.
The year-on-year drops were nearly the same, with Intel servers down 28.6 percent and Unix off 27.3 percent.
IBM LEADS THE WAY
IBM bested all comers on a quarterly and year-on-year basis and its $3.3 billion in sales were more than twice its three closest competitors -- Compaq Computer Corp. (NYSE:CPQ - news), Sun, and Hewlett-Packard Co. (NYSE:HWP - news) -- which each had $1.4 billion to $1.5 billion in sales.
IBM showed the largest gains in share, which most vendors have said is the best standard for judging performance in the shrinking market.
Its 30.3 percent share was up 7.0 percent year-on-year, with HP's share up about 0.1 percent, to 13.1 percent; Sun's down 3.6 percent, to 13.7 percent share; and Compaq down 1.9 percent, to 13.8 percent.
IBM also showed the largest quarterly market share gain, 2.3 percent.
Dell Computer Corp. (Nasdaq:DELL - news), the No. 5 worldwide vendor with an emphasis on Microsoft/Intel servers, saw its share drop 0.1 percent year-on-year, to 6.4 percent, and sold $694 million of servers.
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