Virtualization Slows Server Boom

• By theWHIR.com , November 27, 2006

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November 27, 2006 -- (WEB HOST INDUSTRY REVIEW) -- IT analyst firm Gartner (gartner.com) announced on Wednesday that the increasing use of virtualized servers has slowed down the growth of the server market, according to reports.

The analysis firm says about two million servers were sold worldwide during the third quarter of 2006, up 9.1 percent over the same quarter last year. However, that is down from the 13.2 percent growth the server industry saw last year.

According to reports, global server revenue hit $13 billion during the third quarter, which is up 4.4 percent from the third quarter in 2005, but still down from the 5.1 percent growth experienced in total last year.

Gartner says Hewlett-Packard led vendors, with a 26.5 percent market share, ahead of Dell with its 22.5 percent market share. They are followed by IBM with its 16.3 percent, Sun Microsystems at 4.1 percent and Fujitsu at 3.2 percent.

Gartner says despite the numbers, the server market is still growing, but at a slower rate because of the increasing use of virtualized servers. The firm expects to see a significant impact from virtualization technology on server sales over the next five years, especially with regard to x86-class servers.

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