Revised server numbers hurt HP, help IBM
Hewlett-Packard's server business declined more than originally thought in 2002, according to revised figures from research firm Gartner. IBM, on the other hand, did better.
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IBM also accounted for more server sales than anyone else in the first quarter of 2003, according to the new Gartner figures, which contrast with an IDC report earlier this month that had handed the crown to HP.
An underestimation of HP's worldwide server revenue in the fourth quarter of 2001 prompted Gartner to revise its overall growth/decline figures for 2002 and its figures for the last quarter of the year. The increase in the 2001 figures meant that HP's numbers for last year were falling from a greater height.
In the fourth quarter of 2002, HP saw its market share, as defined by revenue, decline by 16 percent, rather than 6 percent, as previously stated by Gartner. HP's share of Unix server revenue, a subset of the market, dropped 15 percent, rather than growing by 6 percent.
Overall, HP sold $10.8 billion worth of servers in 2002, 25.2 percent of the $43.1 billion market, under the revised numbers.
Gartner analyst Jeffrey Hewitt said the confusion came about because Gartner released its figures before HP released quarterly results, and HP didn't provide sufficient feedback when Gartner asked about its numbers.
"It was let go for a while," Hewitt said of the communication in 2001. "Nobody from HP came forward and said, 'You know what, this needs to be corrected.' Our numbers were too low. It made the growth rates anomalous."
The communication issues happened in 2001, but Gartner and HP have been in close contact since last year, Hewitt said.
Sun, meanwhile, benefited. The Menlo Park, Calif.-based company saw its revenue share of the market decline by 10 percent, rather than 16 percent, as previously believed. Sun accounted for 15.1 percent of the overall server revenue in 2002.
As a result of the recount, IBM, the largest server company, saw its 2002 market share climb slightly. But Big Blue will probably crow more loudly about the turning of the tables on HP for the first quarter of 2003.
Gartner said IBM racked up $3.2 billion, or 30 percent, of worldwide server revenue in the first quarter, for growth of 8 percent. HP came in second with $2.6 billion, or 24.7 percent, of the $10.6 billion market, a decline of 7 percent.
The two companies have been battling over servers for some time and were tied for first in Unix revenue during the fourth quarter of 2002, according to IDC.
Sun and Dell Computer came in at third and fourth, respectively, in the first quarter, but with an important difference. Sun's market share, as defined by revenue, declined 20 percent, to $1.4 billion, while Dell's market position grew 23 percent, to $938 million. The market overall declined by 1 percent.