By Amy Newman, ServerWatch
IDC today released a report
indicating that solid shipment growth in the worldwide market for
server operating environments will not translate into strong
revenue growth.
The report, titled “Server Operating Environments Market
Forecast and Analysis, 2000-2004,” discusses how the research firm
anticipates that shipments will increase at a compound annual
growth rate (CAGR) of almost 17 percent from 1999 to 2004, while
revenue will remain fairly flat with a CAGR of slightly more than 1
percent.
“Several factors will contribute to the disparity between
revenue and shipment growth in the market for server operating
environments,” said Al Gillen, manager of IDC’s Server Operating
Environments and Software research. “One major factor will be the
market’s transition to lower-priced Microsoft and Linux products.
Also, a surge of upgrades to the various server versions of Windows
2000 products will boost shipments while generating only upgrade
revenue, lowering average per-product revenue.”
The need to support Internet and e-commerce applications as well
as traditional online transaction processing, database, file print,
and application workloads will further drive demand for server
operating environments.
Another major trend the report notes is a mushrooming in the
number of shipments of Linux. In 1999, Linux overtook NetWare as
the number-two server operating environment in terms of new license
shipments.
IDC anticipates that Linux shipment growth will outpace all
other server operating environments through 2004. The firm
estimates that Linux server operating environment shipments will
increase at a CAGR of more than 28 percent from 1.3 million in 1999
to 4.7 million in 2004. Linux revenue will also grow faster than
the rest of the market, increasing at a CAGR of more than 23
percent.
Despite this high growth, Linux server operating environment
revenues will barely exceed $85 million in 2004, and total Linux
server shipments will remain a far second to Microsoft’s Windows
Server product family.
Dan Kusnetzky, vice president of System Software at IDC
attempted to put Linux’s penetration in perspective by comparing it
to Microsoft’s. “While there has been much hype about Linux, our
research indicates the total market for Linux operating system
software in 1999 was about $67 million — or about the same amount
of revenue that Microsoft’s operating systems business generated by
noon on the third working day of January 1999.”