Server, workstation shipments rise in third quarter

Worldwide server and workstation shipments rose in the third quarter, as component shortages eased.

Market researcher Dataquest put server growth at 16.5 percent year over year, with workstations up a more modest 3.9 percent.

The top three server makers--Compaq Computer, Dell Computer and IBM--accounted for 58 percent of the worldwide server market during the third quarter. Overall, server makers shipped at slightly more than 1 million units during the quarter.

Houston-based Compaq widened its lead over IBM, coming in at 27.3 percent market share, compared with 26.5 percent in the third quarter of 1999. Compaq's server shipments grew 20 percent, four points ahead of the overall market.

IBM saw its market share decline as Dell gained ground. For the third quarter, Armonk, N.Y.-based IBM had 16.4 percent share, down from 18.6 percent a year earlier. Dell, of Round Rock, Texas, gained more than two points to a 14.9 percent share, compared with 12.3 percent a year earlier. IBM's and Dell's server shipments grew 2.6 percent and 41.1 percent, respectively.

"IBM's supply-chain constraints were reduced during the third quarter, allowing it to address the backlog carried over from the previous quarter," Gartner analyst Jeffrey Hewitt said in a statement. "Dell benefited from an aggressive marketing strategy on operating systems and advantageous price/performance ratios on lower-end systems."

Hewlett-Packard, of Palo Alto, Calif., lost market share year over year, while Santa Clara, Calif.-based Sun Microsystems gained--with the strongest overall growth. HP dropped to a 10.9 percent share from 12.8 percent, while Sun rose to a 7.1 percent market share from 4.8 percent. HP's server shipments declined more than a half point year over year, while Sun jumped 72.4 percent.

On the workstation front, Rambus memory shortages that hurt sales in the second quarter eased. But some vendors experienced minor shortages in graphics cards in the third quarter, Gartner analyst Pia Rieppo said in a statement.

Dell led the worldwide workstation market during the third quarter with 23.6 percent market share, up from 17.3 percent a year earlier. Dell posted the strongest growth: 41.4 percent.

Second-ranked Sun saw modest gains, with market share rising to 21.3 percent from 20.3 percent a year earlier. Sun's workstation shipments grew 9.4 percent year over year.

HP continued a market decline, shrinking 17.2 percent, as it dropped to third place from first. HP had market share of 17.8 percent, compared with 22.3 percent a year earlier.

Compaq's market share was flat year over year at 13.5 percent, while shipments increased a modest 3.8 percent, one-tenth of a point behind the overall market. IBM held on to fifth place, as unit shipments declined 17.7 percent year over year. Big Blue had market share of 10 percent, compared with 12.6 percent a year earlier.

While workstation shipments only rose 3.9 percent year over year, market growth is on track for 2000, Rieppo said. "Overall, the industry is right on track for Gartner Dataquest's forecast 8 to 9 percent annual growth rate from 1999 to 2000."