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Low Figures for Quarter 4 Server Sales

Server sales saw a decrease in during the fourth quarter of 2005. Considering that overall server sales have increased in the past year by 4.4% this may seem a bit surprising. However, it seems that many companies are opting to by low-cost servers, which is the cause for the recent decline that marks the first loss in revenue since early 2003. Server market sales for the fourth quarter were $14.5 billion, though 2005 was a fine year for server sales in general.

IDC said worldwide server revenue grew 4.4 percent to $51.3 billion for 2005, with unit shipments growing 11.6 percent to 7 million. Volume systems, smaller machines that IDC classifies as costing roughly $25,000, continued to carry the market, growing 7.3 percent from the year-ago period. Sales for midrange enterprise servers, costing $25,000 to $499,000, plummeted 11.5 percent year over year, the high-end enterprise server market, $499,000 and up, dipped 1.7 percent.

As per IDC, these machines will continue to spur market growth as demand for larger, more expensive midrange and high-end systems, fades. Servers based on Windows, a popular operating system for volume machines, accounted for a third of server market revenue at $4.9 billion for the quarter. For the first time, the Windows server market beat the Unix market in terms of dollars spent over the course of a full year. The research firm said customers used Windows servers for enterprise workloads and server virtualization projects.