Perfect Storm Sinks Unix Server Sales

The economic recession hit the Unix server market hard. IDC market-share numbers show that users put off buying Unix systems in recent months, cutting Unix's share of overall server spending to one of the lowest levels ever.

An IDC report, released last month, tallied worldwide Unix revenue of $2.3 billion -- about 22% of total spending on servers -- during the first quarter of this year. The Unix share of server revenue was down 10.5 percentage points from the same quarter a year earlier.

The latest numbers notwithstanding, Unix still accounts for a big portion of server revenue. Unix servers are mid- to high-end systems that typically run mission-critical applications, but they are gradually declining in popularity as x86 servers grow more powerful. Unix servers may run one of several Unix variants, including Solaris, AIX and HP-UX.

IDC analyst Jean Bozman attributed the sharp drop in first-quarter Unix server sales to a combination of factors, including these:

• The recession delayed sales of Unix servers, which are typically replaced every five to seven years.

• Although Oracle Corp.'s deal to acquire key Unix server vendor Sun Microsystems Inc. closed in January, users might be putting off purchases of Sun products until Oracle fully absorbs the company.

• Users may be waiting for Unix server upgrades from Hewlett-Packard Co., which recently announced new products in its Integrity line, and from IBM, which is expected to release new Unix servers later this year.

Analysts said it's too early to gauge whether users are accelerating a shift away from Unix.

Oracle may be "the biggest question mark, although the company has thrown its weight behind Sun's UltraSparc Unix systems," said Pund-IT Inc. analyst Charles King. "[Oracle] said that it will continue development, but it is going to take a while for us to really see what the shape of that is going to be."

This story was originally published in Computerworld's print edition. It was adapted from an earlier version that first ran on Computerworld.com.

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