Take, for example, the press release issued by Sun Microsystems yesterday regarding the research:
"Sun Microsystems, Inc. today announced that it once again holds the number one position in the RISC/UNIX server market worldwide. According to 3Q01 Dataquest numbers, Sun''s 55 percent marketshare in shipments is more than that of its nearest three competitors combined. Furthermore, with nearly $1.5 billion in revenue, Sun has significantly outpaced its competitors in marketshare revenue gain."
All of that is true. This relatively sunny view of the research is shared by Compaq in its own press release:
"Compaq Computer Corp. today announced it has regained the #1 market share position for industry-standard (Intel architecture) servers in both the U.S. and North America for Q3 2001. According to statistics released by industry research firm Dataquest, Compaq ProLiant servers gained two percentage points of market share in the U.S. sequentially, and more than two points in North America. Dataquest figures also indicate that Compaq has grown faster than any other major competitor for the past two quarters in this segment."
Now, leaving aside the issue of whether Intel-based servers are the industry standard (Sun, IBM, and Hewlett-Packard may disagree), Compaq''s press release is basically true as well.
A more analytical view of the data yields a different story, however: worldwide server sales slowed down in the third quarter, mirroring a general slowdown in the worldwide economy.
Gartner Dataquest estimates that worldwide server revenue dropped 23.4 percent in the third quarter when compared to the third quarter of 2000: $10.8 billion in 2001, as opposed to $14.1 billion in 2000. Sales in the United States plummeted even further: 29.4 percent when compared to the third quarter of 2000.
Almost every major vendor took their hits both in terms of market share and revenues, according to Dataquest. While Sun does have a major share of the RISC server space, its share of the total server market shrunk from 17.3 percent in 2000 to 13.7 percent in 2001, and its server revenue went from $2.4 billion to $1.5 billion. Why the drop? Corporate purchases are down, dot-coms aren''t buying servers, and Intel-based servers running Windows and Linux are biting off the low end of the server spectrum, as corporations are replacing UNIX-based servers with Windows/Linux servers.
In fact, the Intel server market is now almost as large as the UNIX/RISC server market, says Dataquest: The UNIX/RISC market generated $4.6 billion in revenues, compared to $4 billion in sales for Intel servers. While both markets shrank in the third quarter, the Intel market shrunk modestly (down only 3.1 percent), while the UNIX/RISC market shrunk 15.5 percent.
That''s why it''s no surprise that the vendor with a major presence in both the UNIX/RISC and Intel markets is the vendor who came out smelling like roses in Dataquest''s research: IBM. In fact, IBM gobbled up 30.3 percent of all server revenue in the third quarter of 2001: $3.3 billion. This was an increase of 7 percent in terms of market share over 3Q2000. Strong sales across the board accounted for the increase.
Still, not all was rosy on the Intel side. Compaq is the number-one seller of Intel-based servers, but it gathered only 13.8 percent of server revenues, down from 15.7 percent a year ago. And while Dataquest measures past performance, it makes no estimates on future performance, so we''ll need to stay tuned to see if the economy rebounds to the point where the server market rebounds as well.