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Compaq leads surging Linux server market

The company is the top seller of Linux servers, beating out Linux specialty shops as well as other established computer makers in a market that grew 166 percent in one year.

Compaq is the top seller of Linux servers, beating out Linux specialty shops as well as other established computer makers in a market that grew 166 percent in one year, a study has found.

Compaq sold 18,000 Linux servers in the fourth quarter of 1999, according to a study released this week by International Data Corp. (IDC). That gives Compaq 25 percent of the 72,400-unit market.

Specialty shops such as VA Linux Systems, Penguin Computing and Atipa didn't make the top five, but IDC doesn't track those companies individually, the firm said. IBM was second, with 7,000 servers and 10 percent of the market. Hewlett-Packard was third, with 5,400, Dell fourth with 5,200 and Fujitsu Siemens fifth with 2,300.

VA would have come in fifth place, spokeswoman Eureka Endo said. The company sold 3,843 machines from November through January, including workstations as well as servers, she said. Accounting for the small fraction of sales that were workstations and for the slightly different time frame, that still would put VA ahead of Fujitsu Siemens, she said.

The study highlights the adolescent growth spurt of the relatively young operating system. Though Linux has been around for years, major hardware and software companies only began announcing support in late 1998 and early 1999. As Linux gradually matures, though, it faces stiffer competition in the form of Microsoft Windows 2000, the successor to and improvement on Windows NT.

The Linux server market accounted for only 6 percent of the total entry-level server market--computers costing less than $100,000. However, the unit growth rate of 166 percent made Linux servers the fastest-growing segment of the server market, IDC said.

The developments with Linux hardware mirror similar studies of software. IDC in February reported that Linux license shipments increased to second place in market share from 16 percent to 25 percent of the 5.4 million copies that were sold in all of 1999.

Microsoft Windows took first place in that study, holding a constant 38 percent market share, but Windows generated far more revenue for Microsoft than all the Linux sales.

Compaq also led in Linux hardware sales for the fourth quarter, with $84 million in revenue. IBM garnered $33 million, Dell $24 million and HP $23 million.

In a recent talk, IDC analyst Michelle Bailey said Linux is of particular appeal to people building Internet services. It's good for "server appliances," computers set up to perform a specific job such as serving Web pages or keeping track of network resources.

CNET's Linux Center In a survey of 195 businesses, 71 percent said they believe their Linux servers stay up and running 99.99 percent of the time--all but 53 minutes of the year. "They've already accepted that Linux servers are a reliable platform," Bailey said.

While the IDC survey found that Linux beats Windows NT for price, performance, security and reliability, NT wins for application choice and ease of use, she said.

Unix, the operating system on which Linux is based, beat Linux on service and support in the survey. Unix also works on much larger and more powerful servers than Linux.

A recent study by consulting firm Booz-Allen & Hamilton concluded that Linux competes more with Unix than with Windows. "We think Linux's greatest threat is to proprietary Unix operating systems, especially Sun Microsystems' Solaris," the report said. "Sun's recent move to make Solaris' source code freely available is evidence of this."