HP and IBM both claim server top spot

Two manufacturers claim to be leading the server market, and both may be right

HP has hit back at IBM for claiming it leads the server market, insisting that HP itself actually owns the number one slot.

Deciding which company is correct is not easy, and depends on what exactly you are counting.

On Tuesday, IBM said it was in number one slot with 33.1 percent of server revenue, according to figures calculated by IDC. Furthermore, it announced that it had increased its share, year on year, by 6.6 percent.

On Wednesday it was HP's turn to chip in and point out that while IBM may be number one in market share figures, if you looked at actual shipments, it was still number one in most sectors. So while IBM may be leading in revenue, HP was leading in shipments, or units sold, the company said.

IDC's figures showed that the overall server market remained a healthy place for all the vendors, with total server revenues growing by 3.5 percent in the third quarter of 2006 and amounting to $12.9bn (£6.67bn).

IBM claimed top spot based on a $3.4bn in revenues and 33.1 percent market share.  HP did not quibble with that, instead pointing out that not only was it number one in overall server shipments (28.8 percent), beating out IBM, but it was also crucially leading in several critical areas, most importantly the growing blade market.

In blades, HP could claim astonishing growth. It grew overall by 43.8 percent and by 35 percent in total market share, year-on-year.

These figures sound very impressive but, as IBM would be the first to point out, HP was starting from a low base having seen its blade sales in the doldrums before a major revamp of its blade line in June.

Where IBM might take exception is in HP's claims for success in the sector of high-performance computing, where IBM traditionally excels. Here HP claimed the number one spot in revenue, with 34.5 percent market share and sales. It also outgrew the market in both revenue, with 13.2 percent growth year-on-year, and shipments, where it claimed 5.7 percent growth in a "a virtually flat total market".

The difference between revenue and shipments is that one measures the total of sales in value and the other in the units shipped. Historically IBM, which sells high-value systems, often wins in overall market share but loses in units shipped. Companies who compete strongly on price, such as Dell, prefer to use the latter figure.