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Gartner: Big Blue tops Linux market

A new Gartner vendor survey has Big Blue seeing green with news that IBM is atop the Linux-server space, while competitors like Sun and HP have slipped.

Fresh off recent news of a survey touting the success of Linux-based servers, IBM received more good news this week as new research ranks Big Blue No. 1 in Linux and blade server revenue.

The first survey, conducted by Stamford, Conn.-based Gartner Inc., was a worldwide server market analysis for 3Q 2004 that showed IBM leading the major Linux-based server vendors in revenue, and posting a growth of 85% in revenue from the same period in 2003.

A second survey, released by Framingham, Mass.-based International Data Corp., had Linux revenue growing 52% year-to-year, while competitors Hewlett-Packard Co. and Dell Inc. lost market share in the same segment.

The two reports mark five consecutive quarters of IBM leading the global server market. Dell's strong growth reinforces that the global marketplace squeeze on HP and Sun, by IBM and Dell, continues.

Michael McLaughlin, a principal analyst at Gartner, said IBM continued to perform well in the Linux space due to its established presence.

"IBM is one of the earliest adopters of Linux and sits well in minds of customers," he said. "They are also able to push Linux on almost every one of their platforms -- X all the way to Z."

A growth rate of 85% translates into $485 million in Linux servers that IBM shipped last quarter, McLaughlin said, as opposed to one year ago when that number was only $262.2 million. Big Blue's nearest competitor was HP, which posted $298 million, followed by Dell with $184.1 million.

"I see this trend staying on track. I definitely see Linux sustaining its high growth rate at about 40% to 60%," McLaughlin said.

McLaughlin explained that growth would only be driven further by the existence of 64-bit Linux computing. In July at LinuxWorld, IBM introduced a series of 64-bit blade servers in the form of the eServer xSeries. Linux-based operating systems -- like Red Hat Enterprise Linux 3 and Novell SuSE Enterprise Linux Server 9 -- both support the new 64-bit processors. IBM's DB2 "Stinger" database and WebSphere application server will support the new servers for Linux distributions before the end of 2004, IBM said.

Another salvo fired by IBM late in the year was the OpenPower 720 server, a Linux-only entry-level server that uses the same hardware as the eServer i5 and eServer p5 systems. Based on the Power5 chip set, the 720 is another example of IBM's foray into 64-bit computing and can be seen as a direct move on Sun x86 Sun Fire server customers.

McLaughlin said OpenPower was not yet the growth server for IBM this quarter, but will certainly be one in the future.

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"IBM is taking advantage of customer demand [with OpenPower] and will be able to obtain [more growth] by tapping into another demand market with the 720," he said.

While the Gartner quarterly survey results did show Sun's overall server revenue down .8 points and HP slipping 6% with Unix server revenue, McLaughlin dismissed any doomsday scenarios and said both companies will continue to "chug along" through the next quarter and into 2005.

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