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Linux jumps to 13.4 percent of the stalling server market

The Linux server market is on a growth spurt, one that may well accelerate as CIOs seek to shave budgets in a recessionary economy.

According to a recent IDC report highlighted by ZDNet, Linux is booming. At just 9.4 percent of the overall server market in terms of revenue in 2007, Linux has now climbed to 13.4 percent of the overall server market, with Unix at 7.7 percent and Windows at 36.5 percent. If Linux server vendors want to continue to grow, at some point they're going to have to come to grips with Windows, rather than eating into the low-hanging Unix fruit.

The big winner in the quarter was IBM, with 33.2 percent of the market. Hewlett-Packard is not far behind, but is moving the wrong way on market share:


Despite the healthy 6.4 percent growth in the overall server market, however, IDC suggests a softening in the server market, as The Wall Street Journal points out:

...(T)he growth came, in part, because manufacturers cut prices on popular product lines. That worries IDC because cutting prices is how companies typically react when faced with softening demand. With economic conditions showing few signs of improvement, price cuts "are a concern, as they may foreshadow a slowdown in market demand," said Matt Eastwood, an IDC group vice president.

Perhaps this softening is one reason that while Linux server growth topped 10 percent, Unix only grew 7.7 percent and Windows struggled to achieve 1.7 percent growth. I actually would have expected a stronger showing from Windows but then, HP, IBM, and Dell all have a vested interest in getting out of Redmond's shadow. Linux points the way to greater independence.

It will be instructive to see if Linux server growth will continue to outpace the rest of the market and, in particular, Windows server growth. In a down economy, Linux may find its direction is up, up, and away. Red Hat and Novell will be the beneficiaries, and perhaps a bit more Ubuntu?.