Skies clear for Sun/Oracle in local server market: Analysts

Vendor needs to capitalise on x86 server growth of 13 per cent say experts

Asia Pacific proved the only growth area for Sun servers last year as end users came to grips with the company's acquisition by Oracle, according to analysts.

Garter statistics indicate Sun server revenues grew year-on-year by 18.8 per cent during the third quarter of 2010, amounting to approximately $130 million in the region. However, relatively slow growth for the brand meant market share for the servers dropped to 6 per cent during the same period. By comparison, IBM, HP and Dell recorded market shares of 43.1 per cent, 29.8 per cent and 11.7 per cent respectively.

Oracle’s Asia Pacific growth was a contrast to its fortunes in the US and Europe where it was the only server vendor in the top five to show a decline year-over-year. Worldwide, Oracle’s market share dropped from 7.4 per cent in the third quarter of 2009 to 6.2 per cent in 2010.

Gartner Singapore principal research analyst, Errol Rasit, said local growth boosted positivity around the Oracle systems business.

“There is even the prospect of Oracle growing its share for non x86 servers such as symmetric multiprocessing (SMP) systems," he told Computerworld Australia.

This is because telecommunication providers and banks still have a requirement for SMP systems in their day-to-day business, he said. Oracle’s intentions to port its Solaris operating system to run on x86 servers has also improved market confidence.

IDC Australia senior program manager, Matt Oostveen, agreed.

“It’s important to remember that Sun was number one in the reduced instruct set computing (RISC) Unix space but that segment of the market is in an overall decline," he said. "Sun/Oracle needs to look to their x86 server lines if they are going to have a sustained server business in Asia Pacific," he said.

Although server shipments grew only 2.9 per cent year-on-year in Australia, vendors grew revenue by 37.3 per cent due to a surge in mainframe investment, largely for IBM. Nevertheless the RISC/Itanium-based Unix servers that make up much of IBM's portfolio have continued to decline as Australian businesses migrate to x86 servers.

Oostveen said Australia was the third fastest growing x86 server market in Asia Pacific excluding Japan.

“IDC believes that strong growth in spending was fuelled by a higher mix of blades and richer memory configurations to support increased adoption of virtualisation,” he said.

Follow Hamish Barwick on Twitter: @HamishBarwick

Follow Computerworld Australia on Twitter: @ComputerworldAU

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