Both IDC and Gartner have released reports detailing the collapse of the worldwide server market, and while there is some difference in their figures, both companies come to essentially the same conclusions: The economy stinks and server vendors are suffering for it.
According to IDC's Worldwide Quarterly Server Tracker, worldwide factory revenue in the second quarter of 2009 fell 30.1 percent to $9.8 billion, compared to the same quarter in 2008. Unit shipments fell 30.4 percent, the industry's largest year-over-year decline.
This is the fourth consecutive quarter of revenue decline and the lowest quarterly server revenue amount since IDC began quarterly tracking of the server market in 1996.
"Fewer servers have been shipped over the past four quarters than at any time since 2005 and it is clear that the worldwide server installed base is aging rapidly," Matt Eastwood, group vice president of Enterprise Platforms at IDC, said in a statement. "In the weeks and months ahead, IDC believes that IT customers around the globe will begin to focus on the future once again, making strategic compute platform decisions for the next business cycle and driving more predictable server demand as market conditions stabilize in the second half of 2009."
The findings from Gartner were only slightly less painful. It found worldwide server shipments for the second quarter of 2009 dropped 28 percent year-over-year, while revenue fell 29.4 percent from a year ago to $9.68 billion.
"The server market remains constrained on a worldwide level," Jeffrey Hewitt, research vice president at Gartner, said in a separate statement. "Server sales have felt the impact of reduced budgets since the last half of 2008 and the second quarter of this year remained in the negative."
Volume systems -- defined by IDC as under $25,000 -- declined 30.0 percent, while midrange enterprise -- from $25,000 to $250,000 -- was down 28.1 percent year over year. High-end servers fell 32 percent.
IBM still leads
IBM (NYSE: IBM) pulled off a hat trick. Its sales fell year-over-year -- 26.3 percent by IDC's measure, 27.1 percent by Gartner's measure -- yet it managed a gain in market share with a 1 percent increase according to Gartner and 1.8 percentage points according to IDC.
It did this partly because other vendors fell even further -- particularly Sun Microsystems. Between its own decline, the aborted sale to IBM and then Oracle's proposed purchase, Sun's customers have been jumping ship and heading primarily for IBM.
IBM has certainly been aggressive in stealing away customers left and right. IBM's strength in the quarter came from System x and System p, the likely migration choice for ex-Sun customers.
HP (NYSE: HPQ) maintained the No. 2 spot in the quarter with a 28.5 percent share according to IDC, or 30.1 percent according to Gartner. Dell (NASDAQ: DELL) held on to third place with 12.4 percent of the market by IDC's reckoning, 13.3 percent according to Gartner.
Both researchers agreed on one thing: Dell had the smallest percentage drop of all server vendors.
Sun (NASDAQ: JAVA) took the biggest plunge, falling 37.2 percent to 10 percent market share by IDC's measure, or down 36.2 percent to 10.8 percent market share according to Gartner. Fujitsu/Fujitsu-Siemens held on to its fifth-place slot.
In another big shift, IDC found the market for non-x86 servers fell 32.2 percent to $4.7 billion, marking the first time in six quarters that x86 dollar volumes have beaten non-x86.
Typically, non-x86 systems -- Sun UltraSparc, IBM Power and Intel Itanium -- have much lower volume but sell for a lot more because they are larger, mission-critical systems used in vital datacenters.
IDC said Microsoft Windows server revenue of $3.7 billion was off 27.7 percent year-over-year, while Linux server revenue declined 28.9 percent from last year to $1.3 billion. Windows servers now represent 38.1 percent of industry server revenue while Linux servers now account for 13.8 percent of all server revenue.
In addition to platforms, Gartner divided the business up by geography. Europe, the Middle East, and Africa (EMEA) fell the most, with a 31.9 percent decline in shipments and 35.8 percent in vendor revenue year over year.
Asia/Pacific felt the least downward pressure on units with a 17.2 percent unit decline, and it also had the least vendor revenue impact for the period with a 15 percent decrease.
The blade server market showed strength in that it didn't fall anywhere near as far as the rest. IDC said second consecutive quarter factory revenue dropped only 12.1 percent from a year ago. IBM actually went into the black on this one, gaining 3.8 points of market share on 2.3 percent year-over-year revenue growth.
HP still dominates the market, though, with 52.9 percent revenue share. IBM is in second place with 27.2 percent revenue share and Dell was in third with 9.1 percent.
Gartner's figures were a little more severe, with x86 blade servers down 23.6 percent in units and 13.6 percent in vendor revenue for the second quarter.
Article courtesy of InternetNews.com.