Dell nears Sun in IBM-led server race (News.com)

Posted May 26, 2004 16:36 UTC (Wed) by gilb (subscriber, #11728) [Link]

From the Forbes article by Daniel Lyons (see http://lwn.net/Articles/86683/):

"Indeed, all the billions IBM has pumped into Linux so far haven't bought it a dominant market position. IBM ranks third among sellers of x86-based Linux computers, with a 20% share, versus 28% for HP and 22% for Dell, says market researcher IDC."

Yet in this article we find out that IBM is leading both the overall server market and the linux server market. In addition, it is growing revenues in the mainframe market as well (attributed in part to Linux). Gartner says:

"IBM was the top Linux seller, with 28 percent share, followed by HP with 26.9 percent, Dell with 17.8 percent, Silicon Graphics Inc. with 3.1 percent, Fujitsu with 2.8 percent, NEC with 1.9 percent and Sun with 0.9 percent.

Another bright spot was mainframe revenue, which increased 12 percent to $1.7 billion, Gartner said. Almost all companies except IBM gave up on the market, but Big Blue continues to try to modernize mainframes with Linux, Java and other newer software."

It seems like Mr. Lyons didn't want to admit that IBM's strategy is working. They put in $1 billion so far and have probably gotten 10x that in sales. Note that server sales are only one part of IBM's Linux strategy. Software and services are also a part, with services providing the highest margins and greatest customer loyalty/lockin.

Plus, IBM gets to stick it to Microsoft. (ESR told me at a LUG event that motivation is part of it as well.)