NT is growing -- but at whose expense?
Conflicting market research data suggests Novell NetWare is taking a hit. Or maybe not.
By Mary Jo Foley, Sm@rt Reseller
April 23, 1999 1:57 PM PT
Nearly every market research outfit concurs that Microsoft Corp.'s NT operating system is growing in popularity. But no two seem to be able to agree on whether competing operating systems are taking a hit as a result.
Just this week, two different research firms issued seemingly conflicting findings on this very topic. Gartner Group's DataPro unit released numbers showing NT Server shipments rising, while Novell Inc. (Nasdaq:NOVL) NetWare ones are declining. But International Data Corp. this week issued a release claiming that NT, while growing substantially, is not displacing NetWare or Unix in the process.
According to DataPro's figures, the number of NT Server 4.0 installations rose from 47.5 percent of PC servers in 1997 to 52.9 percent in 1998. DataPro also claims that simultaneously, the number of NetWare installations dropped from 40.6 percent in 1997 to 31.2 percent in 1998.
Microsoft (Nasdaq:MSFT) cited similar figures during its Q3 earnings call this week. Company officials said NT Server has achieved a greater than 50 percent market share on new Intel-based servers.
But there's more to the story
IDC's preliminary market figures show solid growth for NT, in comparison with other server operating environments, as well. Between 1997 and 1998, NT grew 27 percent in terms of shipments, compared with NetWare, which grew 13 percent, the research house says. In 1998, NT comprised 35.8 percent of the total of 4.3 million server operating environments shipped, says IDC. NetWare comprised 24.2 percent of that total, IDC adds.
But dollar figures and number of clients per installation data show it's not a simple case of NT goes up and every other operating system goes down.
"If one just read media reports, one would feel that NT is winning and everything else is dying," says Dan Kusnetzsky, IDC director of operating environments. "But the folks who are using Unix will continue to use Unix. And those using NetWare will continue to do so."
An important data point to consider, says Kusnetzsky, are dollars. In 1998, Unix comprised the lion's share of the $5 billion server operating environment market, with 57.3 percent. NT had 27.7 percent of the 1998 server OS market in dollars, while NetWare captured 12.9 percent.
What's going on?
What's going on here? Kusnetzsky says the reason Unix dominates in dollars is Unix systems tend to be bigger. And Unix systems tend to support between 50 to 60 clients per machine, according to IDC data, compared with NetWare's 30 to 35 clients per server and Microsoft's 24 to 25 clients per system.
"In the NetWare market, we're seeing fewer shipments, but people willing to pay more because they can run more clients off a single system," explains Kusnetzsky.
At the same time, NT Server is still tending to be used by customers more as a departmental infrastructure server, for things like file/print, messaging, and communications, rather than as a major enterprise server running mission-critical applications. NetWare is used in similar scenarios, IDC says. But the top four Unix uses, according to IDC's research: database platform; messaging server; host for custom commercial applications; and host for custom technical applications.
"We're seeing NT come in most rapidly when people want to do something new," Kusnetzsky. In terms of legacy support, "other operating systems are still a lot more mainframe-friendly."
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