David Braue08 May 2008, 7:20 AM
Microsoft has its work cut out if it wants to catch Linux in the Australian server OS marketplace.
Microsoft may be hoping to king-hit the market with Windows Server 2008, but the latest market share figures from IDC suggest the longtime server giant may have its work cut out for it if it’s going to catch up to Linux within the Australian market.
In the third quarter of 2007, the latest period for which figures are available, IDC reported the shipment of 29,949 x86-architecture servers to Australian customers – “higher than our expectations”, says Matthew Oostveen, research manager for enterprise servers, workstations, and high-performance computers arm of IDC Australia.
The composition of those sales, however, painted the rosiest picture for Linux, whose healthy 15.91% market share reflected a 4.4% quarter-on-quarter increase. Windows Server was still the dominant platform in the market, with 78.02% market share, but it showed a slight decline in shipments. And, despite their ongoing role in some of Australia’s most mission-critical environments, shipments of proprietary Unix platforms were lagging.
These results are consistent with global figures released in February by Gartner, which noted a 7.4% increase in overall server shipments in 2007 compared with 2006. Revenue, however, grew just 3.8% -- suggesting an overall trend towards less-expensive x86 servers. Blade servers, which are typically associated with virtualisation because they allow for easy expansion, grew 19.9% year-on-year in volume terms, and 44.5% in revenue terms – suggesting companies are beyond the toe-in-the-water phase and are making major commitments to high-end blade systems.
Getting virtual – and small?
With its ability to squeeze more operating power out of each server installed, virtualisation has become a major driver behind a growing number of server purchases – which, in turn, has led to a growing number of companies choosing Linux as their platform of choice. The scalability of VMWare’s popular ESX Server, in particular, is making it a popular base for virtualised Linux servers running Web, network services and other core servers.
Virtualisation has been a significant part of Microsoft’s design of Windows Server 2008, with its Hyper-V hypervisor and Microsoft Application Virtualization technologies allowing individual applications, or entire servers, to run side by side within the Windows environment. The technology is a direct dig at VMWare, whose unfettered run into the enterprise has left Microsoft in the unusual position of follower.
Despite initial scepticism, Oostveen admits he’s “quite impressed” with Microsoft’s virtualisation effort: “Microsoft is bringing virtualisation to the proletariat,” he says. “They’re starting to be a bit more mature in understanding that Windows doesn’t solve every problem. They’ll try to ride on the success and the massive momentum that VMWare has.”
Perhaps a more pressing problem for Microsoft’s virtualisation effort lies in its customer base. Although virtualisation has found a natural home within larger organisations requiring large numbers of servers, many will already have deployed ESX Server and will be loathe to switch to Hyper-V, no matter how good it is, without a compelling reason.
This, Oostveen suggests, pins the success of Windows Server 2008’s virtualisation on the small and medium business (SMB) market: “It’s all eyes on SMB,” he says. “Having such a complex operating system is a double edge sword, since its success is going to depend on penetration in the SMB market. The challenge is for Microsoft to skill up the larger systems integrators to be able to support this.”
In intention, at least, SMBs may be starting to rise to the challenge. In December, separate IDC research predicted big things for the SMB market, which it believes will jump on the consolidation and virtualisation bandwagon throughout the course of 2008.
Although SMBs’ strategic focus will initially be on commodity services such as storage and remote access, IDC believes an increasingly sophisticated user base will steadily push upwards. Stronger adoption of ancillary technologies such as unified communications, software-as-a-service offerings, and managed services will push SMBs towards solutions in these areas – all of which Microsoft has been actively pursuing.
Not dead yet
Although commodity x86 servers continue to drive the pace of the market, Oostveen is quick to point out that traditional Unix servers, despite their languishing market share figures, are far from disappearing. “The Unix base is always going to have its place,” he explains. “I don’t think we’ll see it disappear in the next 15 to 20 years.”
Old standbys such as HP-UX, IBM AIX and Sun Solaris continue to play a major role in many companies, even as legacy platforms in environments where commodity systems comprise the bulk of current server purchases. IBM, for example, saw a 10.2% growth in its x86-based System x servers during 2007, while its mid-range System p series, which runs AIX and Linux, grew 9.1%. By contrast, revenues for System z mainframes and System i (midrange AS/400 servers) dropped 9.6%.
Similarly, shipments of HP’s mid-range Integrity servers jumped 56.8% year-on-year, and its hardened Unix-based Integrity NonStop servers – which support HP-UX, Windows Server, Linux, and OpenVMS – reported a 13.8% increase. Such figures suggest that the market leaders’ multiple-platform strategies have extended the life of their legacy operating systems, since they’re allowing customers to make the transition to newer platforms at their own speed – and covering all the bases so customers see no need to defect to competitors.
For Oostveen, the big disappointment in the server market is Apple, which despite having a strong technology story – strengthened with the recent release of Mac OS X 10.5 ‘Leopard’ Server – has failed to create opportunities for itself in the general server market.
“It’s one thing to have a good product,” he says, “but the problem is that they just don’t take it seriously enough within Apple Australia. It’s a shame, since they have great momentum; there’s a natural progression [from consumer success] and with the right wording and right focus, they could see inroads into [the corporate] market.”
For now, however, Australia’s server market is decidedly a two-horse race. Although the latest figures may have Linux leading the server market in growth terms, continually fluctuating fortunes make the race between Windows Server and Linux a dead heat.
Inevitable interest from many large customers should drive at least a short-term spike in Windows market share, but just how much the 2008 update tips the scales back in Microsoft’s favour is yet to be seen. No matter the numbers, however, one thing is certain: businesses have a broader range of modern server operating systems – and real computing options – to choose from than ever before.