Monday, March 12, 2001

Worldwide Server Revenue Totaled $54 Billion in 2000

The worldwide server industry had revenue of $53.8 billion in 2000, an increase of 11 percent over 1999 revenue, according to Dataquest Inc., a unit of Gartner, Inc.. The industry benefited from a strong fourth quarter as revenue reached $14.8 billion, an 18 percent increase over the fourth quarter of 1999.

"We are not yet seeing the effects of an economic slowdown on the server market, and competition is continuing to heat up as the market matures," said Jeffrey Hewitt, principal analyst covering servers for Gartner Dataquest's Computing Platform Worldwide group.

Despite flat growth in 2000, IBM retained its No. 1 position in the server industry based on worldwide revenue. Dell Computer and Sun Microsystems experienced the strongest growth among the top-tier vendors with growth rates of 73 percent and 43 percent, respectively.

In the U.S. server market, revenue reached $20.3 billion in 2000, an increase of 15 percent over 1999. Sun was the No. 1 vendor in the United States based on revenue with 24 percent market share. IBM slipped to the No. 2 position with 23 percent market share, followed by Compaq at No. 3 with 19 percent of U.S. server revenue.

"Demand for servers is still high, especially in e-business, front-end Web, Web application and database servers, which will continue in 2001," said Shahin Naftchi, senior analyst covering servers and workstations for Gartner Dataquest's Computing Platform Worldwide group.

Java Careers Still Hot
Gartner, Inc. is reporting that Java, along with Microsoft technologies, will represent 75 percent of new e-business application development initiatives by 2003. According to the Gartner survey of more than 400 IT professionals, 80 percent report that their organizations use Java technology today.

The Gartner survey delivers a signpost for IT professionals and college students alike: Learn Java. Unlike the hue and cry of 1995 — which was "Learn HTML" — demand for Java is derived from massive business-to-business applications that will thrive long into the next decade.

Seventy-one percent of Gartner survey respondents named a lack of qualified resources and skills as the top problems in Java adoption. Sixty-six percent say that the skills issue will still be the main concern two years from now. Sixty-nine percent are hiring Java professionals directly into their companies, and only 22 percent are outsourcing the job to external service providers.

"Specialized careers like those of IT professionals usually fare well even during tough economic times," said Robin Flatau-Reynoso, Gartner analyst. "Java is a great skill to have in the IT professional portfolio over the next five to 10 years."

News Tidbits (appears every day on the front page)
- Yahoo shocked a lot of people when it announced last week that its CEO was stepping down and that it wouldn't meet revenue projections. Along with Amazon.com, Yahoo has long been regarded as one of the leading online businesses, showing that during economic downturns, business models must go beyond advertising dollars to achieve success.