The server racket returned to something resembling normalcy in the third quarter, according to the box counters at IT market-watcher Gartner.
The company reckons that global server revenues in Q3 rose by 15.3 per cent to $12.29bn, while the number of machines kicked out of the world's server factories rose by 14.2 per cent to 2.19 million units.
According to Jeffrey Hewitt, research vice president at Gartner, all regions of the globe had year-on-year growth for both server sales and shipments, except for Middle East and Africa, which saw revenues slip 2.9 per cent even as shipments rose by 4.2 per cent. Server revenues in Eastern Europe rebounded sharply, up 33.3 per cent, making it the fastest growing region on earth. Western Europe had an 8.8 per cent bump in shipments against a 5.7 goose in overall revenues across all server types.
Server sales in the United States rose by 16.3 per cent, nearly matching a 17 per cent rise in shipments. But the US is still a big user of mainframes, and with IBM finally seeing some bounce in its System z business now that the zEnterprise 196 machines were shipping at the end of the third quarter, this partly masked declines in Unix sales as shipments of x64 boxes increased — particularly at penny-pinching hyperscale data centers, which are consuming fleets of machines.
"As in the first half of this year, x86-based servers were the main driver of the market; they grew 14.9 percent in units and 29.5 percent in revenue in the third quarter of 2010," explained Hewitt in a statement accompanying the server revenue and shipment breakdown. "Also following earlier trends, the x86-based server market provided an increase in average selling prices from more robust server configurations to accommodate virtualization; these higher average selling prices pushed revenue higher than shipments, and this was the case in the third quarter for all regions."
Servers using Xeon, Opteron, and a smattering of other x64 processors accounted for the vast majority of server shipments — as they have for the past decade — along with the lion's share of sales, as well. The 2.14 million x64 machines peddled and pushed in Q3 accounted for $8.19bn in revenues on a global basis, with shipments up 14.9 per cent, but revenues up 29.5 per cent.
There's no question that x64 shops are buying fatter boxes to support larger and often virtualized workloads, and that companies which slammed on the brakes two years ago on x64 spending as the Great Recession got rolling are able to make much more compelling arguments about why it is smart to upgrade older machines to shiny new boxes in 2010's budget cycle.
In the x64 sector of the market, HP is the leader, with $3.13bn in sales, up 36.2 per cent, and 704,978 boxes, up 16.6 per cent. Dell is the number two player, with $1.79bn of revenues, up 25.6 per cent, against 501,593 shipments, up 14.7 per cent.
IBM is a distant third in terms of shipments, with only 266,425 boxes going out — but rising 18.6 per cent compared to the year-ago quarter. However, because IBM has some high-end and fat-memory boxes, Big Blue's x64 revenues were a lot closer to Dell's at $1.48bn, up 30.3 per cent.
Fujitsu and NEC rounded out the top five x64 server sellers, with $320.3m and $208m in revenues, respectively.
The way Gartner counts the Unix racket, machines based on RISC or Itanium processors are lumped together and compared, but x64 or other architectures running any Unix variant are not put into the Unix category for comparison — which leaves Solaris on x64 boxes out in the cold.
Across all vendors, customers only bought 49,052 RISC/Itanium machines running a variant of Unix in the third quarter, down 10.1 per cent from a pretty awful year-ago quarter. Despite the skinny numbers, RISC/Itanium machines running a Unix variant still command a hefty premium, and revenues across the group were $2.35bn in the quarter, down 9.5 per cent.
By revenue, IBM is the leader among RISC/Itanium machines running Unix, with $953.8m in sales, down 10.3 per cent. HP is number two, with $662.9m in sales for this category, down 13.1 per cent. Oracle has more or less stopped the bloodletting at Sun Microsystems, with sales only off 1 per cent in Q3 to $622.1m on the Sparc/Solaris front. Fujitsu and Bull were hammered in the quarter, falling at nearly three times the rate as the market overall. Fujitsu pushed $76.8m in Unix iron, while Bull only did $20.4m. Both companies are at this point trying to peddle their x64-based machinery.
If you do the math and take out x64 and Unix machines based on RISC or Itanium processors, you get the Other category. Some 4,985 boxes pushed in Q3 accounted for $1.75bn in sales. IBM's "other" category, which includes a lot of mainframes and some Power System sales running OS/400 (now called IBM i), accounted for 3,033 boxes, down 15.7 per cent, but $1.28bn in sales, up 8.4 per cent.
All told, HP remains the dominant server seller across all architectures, a position it booted IBM from last year. IBM had held that top spot as long as there have been system, so this was a significant change. HP's overall server sales came to $3.94bn, up 22.5 per cent, while IBM only grew by 9.9 per cent, to $3.72bn.
Dell only sells x64 servers, so its $1.79bn in sales gives it the third-place ranking, and its 25.6 per cent revenue growth is the best among the top five vendors, and very likely across the entire market.
Oracle ranked fourth in overall server sales, with $764m in revenues in Q3, down 2.6 per cent as it pulls back from unprofitable x64-server peddling — and rightly so, seeing as how the server biz is not a charity. Fujitsu ranked fifth, with $582.2m in revenues, up 5.2 per cent.
Other vendors combined accounted for $1.49bn in revenues, up 15.2 per cent and keeping pace with the market overall. These other vendors as a group maintained their slice of the server pie at 12.2 per cent.
Interestingly, blade-server shipments stalled when compared to the market at large, with shipment growth of only 7 per cent, but revenues for blades rose by 26 per cent, better than the overall server space. Some companies like fat blades, apparently.
Others like their skinless, cookie-sheet servers, which Gartner said are helping to prop up the rack-based server segment. Gartner did not break out the shipment and revenue data for cookie sheet boxes separately in its public analysis of the Q3 data, but said that rack-based machines saw 23.7 per cent growth in shipments and 31.2 per cent growth in revenues, handily beating the market at large for sales and boxes pushed. ®