IBM stays tops as server market stabilizes, Gartner says

IBM retained its narrow lead over Hewlett-Packard in the worldwide server market as sales began to stabilize during the third quarter, Gartner said Monday.

IBM took 31.7% of server revenue in the three months to Oct. 31, up a fraction from last year, while HP's share stayed more or less flat at 30.2%, Gartner said. The companies were followed at a distance by Dell, Sun Microsystems and Fujitsu.

Server revenue overall dropped 15.5% from the third quarter last year, to $10.7 billion. But it was up by 10.2% compared to the second quarter this year, Gartner said.

"It is important to put the yearly declines into perspective,” Gartner Research Vice President Jeffrey Hewitt said in a statement. The server market is "showing signs of stabilization as we move toward the end of 2009."

All the top vendors bar one saw their server revenue improve from the second quarter. The exception was Sun Microsystems, whose business has been hit by uncertainty surrounding its acquisition by Oracle.

Sun's server revenue was down 32.3% from the third quarter last year, much more than its main rivals, according to Gartner. It remained the top seller of Unix systems by volume, but its lead was pared down from a year earlier as shipments declined by almost half.

In terms of dollars spent, HP overtook Sun to become the second-largest Unix vendor behind IBM. HP grew its share of Unix systems revenue from 28% to 29.3%, while Sun's declined from 29.2% to 24.2%, Gartner said. IBM's share increased from 36.4% to 40.9%.

The Unix server market overall was worth $2.6 billion, a drop of 21.2% from the third quarter last year.

Industry-standard servers fared a little better. Sales of x86-based systems declined by 11.4 percent from last year, to $6.3 billion. HP retained its dominant lead, followed by Dell, IBM, Fujitsu and NEC.

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