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Sales increase for U.S. Linux servers

U.S. sales of servers running Linux nearly doubled in last year's fourth quarter from a year earlier, according to new statistics from market researcher Gartner Dataquest.

Sales in the United States of servers running Linux nearly doubled in last year's fourth quarter from a year earlier, according to new statistics from market researcher Gartner Dataquest.

Total Linux server revenue was $384.6 million in the fourth quarter, up 90 percent from $202.2 million. By contrast, overall U.S. server revenue climbed just 5 percent in the fourth quarter compared with a year earlier.

IBM was the chief beneficiary of Linux server revenue, taking in some $159.9 million in sales, up from $75.6 million a year earlier. Hewlett-Packard saw sales rise to $80.2 million, up 81 percent from $44.3 million a year earlier. Dell Computer's Linux server revenue grew nearly 66 percent, but fell behind HP, with fourth-quarter sales of $77.1 million, compared with $46.4 million a year earlier. Sun Microsystems, which started selling Linux servers just last year, took in $1.3 million in the fourth quarter, up from $912,500 in the third quarter.

"Linux (sales) increased a lot because of IBM," said Shahin Naftchi, server analyst for Gartner. Naftchi said that IBM is now shipping blade servers, 75 percent of which run Linux.

Linux servers made up more than 14 percent of all servers shipped in the United States in the first quarter, but accounted for just 7.6 percent of total server revenue. A year ago, Linux made up 9 percent of server unit shipments and 4.7 percent of revenue.

In the Unix market, U.S. server sales fell 3 percent from a year earlier to $1.69 billion, down from $1.74 billion. Sun remained the top seller of Unix servers, but saw sales drop more than 27 percent from a year earlier, to $675 million. HP solidified its No. 2 spot in the market, posting a 54 percent year-over-year increase, to $562.6 million. IBM posted a narrower 9.4 percent gain from a year earlier, with sales of $361.8 million. SGI was the fourth-largest seller, but saw sales dip 25 percent, to $39.1 million.

Growth market
Revenue from sales of Linux-based servers surged 90 percent in the fourth quarter compared with the prior year. These are the top 10 vendors, ranked by revenue, for the fourth quarter.

Company Revenue % change
  IBM

    $160 million     +112  
  HP

    $80 million     +81  
  Dell

    $77 million     +66  
  Sun

    $1.3 million     N/A  
  NEC

    $890,000     +125  
  Gateway

    $790,000     -43  
  Acer

    $130,000     -48  
  Micron

    $110,000     N/A  
  Fujitsu

    $20,000     N/A  
  Market
total

    $385 million     +90  
Source: Gartner Dataquest
"HP's Unix is improving a lot," Naftchi said. "HP is gaining customer's trust, especially overseas."

In the Intel-based server market, Dell extended the lead it regained from HP in the third quarter, grabbing 29.4 percent of the market compared with HP's 27.5 percent. Dell sold $531.5 million worth of Intel-based servers in the U.S. during the fourth quarter, up 37 percent from a year earlier. HP's sales grew a scant 0.6 percent from a year earlier, to $496.4 million. IBM remained the No. 3 seller of Intel-based servers in the U.S., with revenue up 28.8 percent, to $244.5 million.

The total market for Intel-based servers in the U.S. during the fourth quarter was $1.8 billion, up 17.4 percent from a year earlier and 3.5 percent from the third quarter. Gartner has also predicted that revenue from less-expensive Intel servers will surpass revenue from high-end Unix-based servers for the first time in 2003.

Intel-based servers accounted for 90 percent of unit shipments in the fourth quarter and 40.3 percent of revenue. A year earlier, Intel-based servers made up 87.5 percent of units shipped and produced 36.1 percent of revenue.

In the overall U.S. market, IBM generates the most server revenue, followed by HP, Sun and Dell. In terms of unit shipments, HP is the leader with 30 percent of the market, followed by Dell at 19 percent.