Apple cracks top-10 server brands during first quarter

[AppleInsider]

Apple Inc. during the first quarter of 2007 broke into the top-10 server brands with its Xserve line, stepping over China-based Langchao, which fell from the rankings, according to the latest data from market research firm IDC.

The IDC report, cited by DigiTimes, indicates that Acer, Hitachi and Apple took eighth, ninth and tenth position with shipments of 14,900, 9,000 and 8,700 units, and on-quarter shipments growth of 5 percent, 26 percent and 73 percent, respectively.

Hitachi replaced China-based Lenovo, which joined Langchao in falling out of the top 10, according to the report.

Overall, worldwide server shipments in first quarter declined 11 percent on a quarterly basis as shipments from Dell and IBM -- ranked second and third -- fell 3 percent and 17 percent, respectively.

Seasonal effects, Intel's schedule to cut CPU prices in July, and AMD's plans to launch its native quad-core processor (Barcelona) in the second half of 2007 are all reported to have contributed to the drop in shipments.

Apple's launching of its fifth generation Xserve with Intel Dual Core Xeon processors is said to have boosted its growth in the server sector, as several enterprises began adopting the Mac-based enterprise machines.

Although Lenovo and Langchao did not list in the top-10 brands in first quarter 2007, their shipments still held level compared to the previous quarter, according to DigiTimes' sources. Those sources added that the reason Hitachi and Apple surpassed the China-based makers was due to their large on-quarter shipment growth.

[ View this article at AppleInsider.com ]

[digitalclips]

Way to go Apple. Now hit the top 5

[MacTel]

It is good to see Apple is still in the game at all. Apple doesn't disclose the number of Xserves sold per quarter so it has been difficult to gauge their acceptance in this market segment. If they're growing as IDC states then that'll just spur further growth. I'm more interested now, by this news, to purchase Xserves than previously.

[solipsism]

Leopard's new server tools will help push Apple even farther ahead in this market.

Oh yeah, my stock will be arising.

[bigpics]

Originally Posted by MacTel

It is good to see Apple is still in the game at all. Apple doesn't disclose the number of Xserves sold per quarter so it has been difficult to gauge their acceptance in this market segment. If they're growing as IDC states then that'll just spur further growth. I'm more interested now, by this news, to purchase Xserves than previously.

It's also good to see posters on this thread who get the importance of the story.

Apple clearly gets it, as they've stuck with this market for years, regularly dedicating enough resources to keep redesigning and refreshing their servers despite shipments which sound minuscule next the rest of the product line.

10's of millions of iPods, millions of Macs and... ...thousands of Xserves. I'm too lazy to do the math, but Apple probably sells more iPods in say, an hour, than Xserves in a year.

But a small shop that decides to go all Apple may buy 3-4 Xserves -- and a hundred or more Macs they probably would not have otherwise. And who knows in the future, may add maybe several hundred iPhones. And the same thing may happen in larger shops which decide to experiment with Apple in a division or a location, or say, for their graphics, video and sound guys as opposed to their Excel addicted bean counters and Word-bound marketing mavens (who could end up running Mac Office at a later date once the Xserve has a foothold in their companies).

Further, if future (or current?) Xserves can virtualize Windows Vista Server and Leopard Server in interesting ways, businesses that have avoided Macs altogether to simplify their IT operations may take a new look, allowing Macs to actually enter those businesses in small but growing numbers.

So there are reasons -- and reasons strategic to the overall "Apple icology" why even during the leaner years this initiative remained alive and mostly well in Cupertino.

And why even game-addicted fan boys should pay at least a modicum of attention to this oft-overlooked part of the skunk works at Infinite Loop.

[Feynman]

Originally Posted by solipsism

Leopard's new server tools will help push Apple even farther ahead in this market.

Oh yeah, my stock will be arising.

Are you basing this on something you know but we don't?

[solipsism]

Originally Posted by Feynman

Are you basing this on something you know but we don't?

Peruse the Apple's Leopard Sneek Peek site for some info.

[Abster2core]

Originally Posted by Feynman

Are you basing this on something you know but we don't?

Probably based on something that most are not aware of, i.e., Leopard Server, at http://www.apple.com/server/macosx/leopard/ and many are looking forward to.

[e1618978]

The best thing in the article is the 73% growth rate for xserve, they are bound to move up the list quickly.

Looking at www.top500.org, I am a bit surprised that other supercomputer facilities did not follow Virginia Tech's and COLSA's lead in using xserve, since their facility was so much cheaper than other installations with similar performance (and that was with the G4 xserve).

[The Pie Man]

Is that correct? Apple is in 10th place, with 8700 units shipped for the quarter? That sure doesn't sound like something to be bragging about.

[solipsism]

Originally Posted by The Pie Man

Is that correct? Apple is in 10th place, with 8700 units shipped for the quarter? That sure doesn't sound like something to be bragging about.

As bigpics points out, when you compare to the number Apple's other hardware sales it doesn't look impressive at all. And, without perspective, I'd day that >8,000 servers seems very small for a quarter, especially considering that it's a 73% gain over the previous quarter.

The real story here is that Apple is gaining marketshare while others are losing it, and that Apple is finally on the radar as the 10th largest server distributor. Unless Hitachi is on an equally impressive growth spurt then it looks like Apple is destined to rank #9 next quarter. If they happen to continue this 73% growth rate it will edge out the current #8 manufacturer. Will Apple do it? I know no clue, but I do know that this news is good for Apple's server solutions.

I wonder how many Xserves are in use today, including Apple's? I wonder they compare to other rack servers in terms of useful life-cycle.

[EruIthildur]

Originally Posted by bigpics

Further, if future (or current?) Xserves can virtualize Windows Vista Server and Leopard Server in interesting ways, businesses that have avoided Macs altogether to simplify their IT operations may take a new look, allowing Macs to actually enter those businesses in small but growing numbers.

Well there is no Vista server to my knowledge and Longhorn isn't out yet, but Parallels is able to virtualize Windows servers, we do it here.

[mstone]

Originally Posted by EruIthildur

Well there is no Vista server to my knowledge and Longhorn isn't out yet, but Parallels is able to virtualize Windows servers, we do it here.

There will likely never be a "Vista" server as Windows Server 2008 is the name of the beta OS being readied for release. As for longhorn, that was just a code name for Vista prior to release.

[ajhill]

Can Apple do no wrong in any of their profit centers?

Talk about hitting on all cylinders.

[melgross]

The fact that Apple's server software can't virtualize OS X instances on servers keeps it out of many large shops. It's difficulty of integration with Exchange is another reason. Problems with Hp Openview, and EMC storage-area networks are others.

If Apple could solve those problems, they would find their servers selling much better in mixed environments.

There are other shortcomings as well. Apple doesn't give a roadmap of what it will be doing as all other players in these markets do. That's a problem for many medium and large firms.

Apple is very focused on small shops. that won't do if they want to triple their sales numbers here, or move into the fifth spot as someone just said they would like to see Apple do.

[AISI]

Originally Posted by e1618978

The best thing in the article is the 73% growth rate for xserve, they are bound to move up the list quickly.

I don't think they will move up the list quickly. Not that it matters much because Apple has a long-term approach and the Xserve (and Raid) is a "must have" offering for Apple in this segment for research, video, etc, whatever the sales figures.

As a comparison, Apple sold 6,000 Xserves in Oct-Dec 2002. (Apple conference call)

5,000 to 6,000 units throughout each quarter of 2003. Sales slumped to a low of 4,412 in Q1 2004 and doubled after a price drop. (Gartner)

13,000 Xserves sold in April-June 2004. (Apple conference call)

In the third quarter of 2004 Apple was already in the Top 10 according to Gartner, growing 119 percent from the year-ago quarter [from about 6,000 to 13,000 units?]. "Analysts [expected] triple digit growth for the Xserve could continue into 2006 before it levels off." The top ten list was as follows: HP, Dell, IBM, Sun, Fujitsu, NEC, Acer, Apple [8th], Legend and LangChao.

In the first quarter of 2005 Xserve shipments were 7,700 according to Gartner.

~5,000 Xserves sold in Q4 2006, since…

8,700 units in Q1 2007 (IDC) with quarter-on-quarter shipments growth of 73 percent.

[JeffDM]

Originally Posted by e1618978

The best thing in the article is the 73% growth rate for xserve, they are bound to move up the list quickly.

Looking at www.top500.org, I am a bit surprised that other supercomputer facilities did not follow Virginia Tech's and COLSA's lead in using xserve, since their facility was so much cheaper than other installations with similar performance (and that was with the G4 xserve).

VT used G5s XServe machines after they used G5 PowerMacs for a while.

[melgross]

Originally Posted by AISI

I don't think they will move up the list quickly. Not that it matters much because Apple has a long-term approach and the Xserve (and Raid) is a "must have" offering for Apple in this segment for research, video, etc, whatever the sales figures.

As a comparison, Apple sold 6,000 Xserves in Oct-Dec 2002. (Apple conference call)

5,000 to 6,000 units throughout each quarter of 2003. Sales slumped to a low of 4,412 in Q1 2004 and doubled after a price drop. (Gartner)

13,000 Xserves sold in April-June 2004. (Apple conference call)

In the third quarter of 2004 Apple was already in the Top 10 according to Gartner, growing 119 percent from the year-ago quarter [from about 6,000 to 13,000 units?]. "Analysts [expected] triple digit growth for the Xserve could continue into 2006 before it levels off." The top ten list was as follows: HP, Dell, IBM, Sun, Fujitsu, NEC, Acer, Apple [8th], Legend and LangChao.

In the first quarter of 2005 Xserve shipments were 7,700 according to Gartner.

~5,000 Xserves sold in Q4 2006, since…

8,700 units in Q1 2007 (IDC) with quarter-on-quarter shipments growth of 73 percent.

Right. Until Apple fixes the problems I mentioned, their sales will never penetrate high up in the listings.

[mynamehere]

Originally Posted by bigpics

It's also good to see posters on this thread who get the importance of the story.

Apple clearly gets it, as they've stuck with this market for years, regularly dedicating enough resources to keep redesigning and refreshing their servers despite shipments which sound minuscule next the rest of the product line.

10's of millions of iPods, millions of Macs and... ...thousands of Xserves. I'm too lazy to do the math, but Apple probably sells more iPods in say, an hour, than Xserves in a year.

You could also buy many, many iPods for the cost of 1 XServe.

I'm trying to get funding for an XServe and XServe RAID with Final Cut Server for our campus TV station...

[tink]

http://www.microsoft.com/winme/0705/...ing_HD_MBR.asx
.
.
.
.
.
uhh,
..... ya. That about sums it up.

(Sorry that was off Topic).
Cracking top ten is pretty cool, though!

[besson3c]

If Apple really wants to attract large businesses/enterprise, OS X Server is in needs of some changes. As of right now, it's pretty much a non-player.

In complicated environments where there is a tremendous amount of burearacy surrounding interdepartmental data flow, Apple GUIs in and of themselves offer little to no compelling reason to buy OS X Server since they can't really be used, for the most part, unless the workflow matches what Apple designed.

While you can quit Aqua, there is little compelling reason to run OS X sans Aqua when there are several other CLI focused Unix OSes that offer a richer CLI environment with OSS package management, a variety of file systems, a kernel that can be optimized and still supported, a more transparent roadmap, rich community support that will take you beyond the comfortable Apple bubble, better OSS support/ease of software compilation/installation, more hardware support, etc.

I've heard arguments that XServe hardware and OS X Server make an inexpensive combo... This may or may not be true, but the question is: how big is the small business market, and will Apple succeeding in this market make a big difference?

[mdriftmeyer]

About damn freakin' time. I just couldn't wait 9 years to get to this point in the Enterprise.

[aaarrrgggh]

What exactly is the target market for the X-Serve? I see a few of them going into data centers, but can't understand who they offer a good value proposition for.

For my small business, I wanted to find an excuse to go with an X-Serve instead of a Dell... but the premium was almost 2x! Even factoring in consulting time to go with Linux, we saved over $1k with the Dull.

I honestly am just having trouble understanding, and would love to know. It seems like Apple really needs to come up with a more cost-effective solution if they want to make a strong push of Leopard Server.

[melgross]

Originally Posted by aaarrrgggh

What exactly is the target market for the X-Serve? I see a few of them going into data centers, but can't understand who they offer a good value proposition for.

For my small business, I wanted to find an excuse to go with an X-Serve instead of a Dell... but the premium was almost 2x! Even factoring in consulting time to go with Linux, we saved over $1k with the Dull.

I honestly am just having trouble understanding, and would love to know. It seems like Apple really needs to come up with a more cost-effective solution if they want to make a strong push of Leopard Server.

The target market are businesses that already have Macs as their primary clients.

Ad agencies, large studios, education, etc.

everything else that Apple gets is gravy.

And that's the problem.

[hugin]

Originally Posted by mstone

There will likely never be a "Vista" server as Windows Server 2008 is the name of the beta OS being readied for release. As for longhorn, that was just a code name for Vista prior to release.

Sorry, but you seem a little confused. Longhorn client was named Vista for release. Loghorn Server was the code name for Windows Server 2008 until May 15 when it got its name.

[hugin]

It would be great to see the whole top 10 list, with sold units _and_ market share.

[JeffDM]

Originally Posted by aaarrrgggh

What exactly is the target market for the X-Serve? I see a few of them going into data centers, but can't understand who they offer a good value proposition for.

For my small business, I wanted to find an excuse to go with an X-Serve instead of a Dell... but the premium was almost 2x! Even factoring in consulting time to go with Linux, we saved over $1k with the Dull.

I honestly am just having trouble understanding, and would love to know. It seems like Apple really needs to come up with a more cost-effective solution if they want to make a strong push of Leopard Server.

Do you happen to know what ihe cost of maintenance is over the life of the server, with respect to Linux and OS X?

[hugin]

What's really missing with the Xserve isn't a lower price tag. It's the support (as with all Apple products). A server needs an (optional) on-site support deal. Todays "buy a new one, or mail in your old one and will fix it within the month" doesn't do it.

[Nicnac]

What melgross said... We are an entirely mac based production unit within a 'normal' business model (read: PC based accounting and sales).
When it was time for us to upgrade from an old 'server' (basically a G4 tower with hard drives crammed in every which way), the x-serve was a no-brainer even though it cost more than an 'equivalent' PC. 2 years later, and I remain convinced it was the best thing we did. The OS is smooth and completely glitch free, backups are a breeze (with SuperDuper), it's quiet, and I feel a lot more secure than I would with a Dull.

[bigpics]

Originally Posted by mstone

There will likely never be a "Vista" server as Windows Server 2008 is the name of the beta OS being readied for release. As for longhorn, that was just a code name for Vista prior to release.

I stand corrected on the product name (too lazy to google around for it) -- but the next gen of Win Server is an announced product, and how Apple -- or Parallels or another virtualization solution provider deals with it will, or could prove interesting and just maybe strategic.

But I'm glad others have recognized that these seemingly tiny numbers portend more than their current direct contribution to A, Inc's bottom line.

I've also read articles on the value prop -- considering the combo of OS X server/Xserve vs. other solutions and factoring in reliability, IT time needed to deal with them, swapping out issues, failover, user support issues, etc., and all have generally tended to support the notion that over the whole life cycle, Xserves are very competitive to clearly superior in both data center satisfaction and overall cost. Apple's OS license is also much less restrictive than MS's, with (unless memory fails again) a flat cost for as many clients as the unit can handle, whereas MS ratchets up (or did rachet up) the cost based on the number of clients. So the reported 2X cost upfront is not all it seems by any means.

[besson3c]

Originally Posted by JeffDM

Do you happen to know what ihe cost of maintenance is over the life of the server, with respect to Linux and OS X?

How could this be accurately measured? It is intangible.

[melgross]

Originally Posted by besson3c

How could this be accurately measured? It is intangible.

It isn't intangible. It's measured by doing industry surveys of companies with said equipment.

It's done all the time.

We just don't have those numbers.

[s.asad]

^Mel's correct. But numbers only go so far.

Us long term thinkers see inevitables clearly.

Apple will continue to gain significant share in this market for the next decade.

[AISI]

Originally Posted by hugin

It would be great to see the whole top 10 list, with sold units _and_ market share.

In Q3 2002 worldwide server shipments totaled about 1.1 million units according to Gartner and Apple sold 7,484 units, its share of the server market was 0.68 percent.

In Q1 2007 worldwide server shipments reached just over 2.1 million units, Apple sold 8,700 Xserves, its share of the server market should be 0.4 percent.

1 - HP: 634,093 units (30.03%)
2 - Dell: 445,850 units (21.12%)
3 - IBM: 295,175 units (13.98%)
4 - Fujitsu: 81,068 units (3.84%)
5 - Sun: 79,063 units (3.74%)
8 - Acer: 14,900 units (0.71%) *
9 - Hitachi: 9,000 units (0.43%) *
10 - Apple: 8,700 units (0.41%) *
Other: 543,416 units (25.74%)
Total: 2,111,265 units (100.00%)

Gartner numbers except * IDC quoted by Digitimes

The Mac is outgrowing the personal computer market, this is not the case with the Xserve in the server market. Apple did pretty well in 2004, but at the moment with less than 10,000 units/quarter, there is nothing to write home about. Xserve shipments should reach 14,968 units just to maintain the Q3 2002 market share of 0.68 percent. Just out of curiosity, if the Xserve server market share was similar to the Mac worldwide market share, Apple would have sold approximately 52,500 units this quarter (6x more).

[besson3c]

Originally Posted by melgross

It isn't intangible. It's measured by doing industry surveys of companies with said equipment.

It's done all the time.

We just don't have those numbers.

I think these numbers might be useful in determining hardware reliability, but I think there are too many variables to account for in the software realm that render these numbers nearly useless in that department.

[besson3c]

Originally Posted by s.asad

^Mel's correct. But numbers only go so far.

Us long term thinkers see inevitables clearly.

Apple will continue to gain significant share in this market for the next decade.

But at this point it appears that they will only pick up market share with small business, and I have no clue what sort of potential is there and how it translates into numbers.

[melgross]

Originally Posted by besson3c

I think these numbers might be useful in determining hardware reliability, but I think there are too many variables to account for in the software realm that render these numbers nearly useless in that department.

First of all, reliability was the subject. Second of all, software problems are easily documented as well.

Do people really think that business don't keep detailed records of problems? I can assure you that they do.

That's how metrics are developed.

For many years now, IDC has done yearly surveys of medium, and large businesses. Every year of those surveys, the Mac has been found to be cheaper for the five year periods that industry uses as their depreciation standard. The more Macs in an organization, the cheaper IT costs are. The reasons are, hardware reliability, training, software maintenance, etc.

All Mac shops have costs that are as much as 36% cheaper over that five year period.

How do you think they arrive at these numbers, guesses?

[melgross]

Originally Posted by besson3c

But at this point it appears that they will only pick up market share with small business, and I have no clue what sort of potential is there and how it translates into numbers.

Apple ignores mid, and enterprise business. They have nothing in place that would appeal to them. In posts above I clearly set out reasons why those business don't look to Apple for their hardware and software.

When Apple decides to address their needs, if ever, that will change, but not before.

[besson3c]

Originally Posted by melgross

First of all, reliability was the subject. Second of all, software problems are easily documented as well.

Do people really think that business don't keep detailed records of problems? I can assure you that they do.

That's how metrics are developed.

For many years now, IDC has done yearly surveys of medium, and large businesses. Every year of those surveys, the Mac has been found to be cheaper for the five year periods that industry uses as their depreciation standard. The more Macs in an organization, the cheaper IT costs are. The reasons are, hardware reliability, training, software maintenance, etc.

All Mac shops have costs that are as much as 36% cheaper over that five year period.

How do you think they arrive at these numbers, guesses?

I don't know how they arrive at their numbers, but I think that they are bogus.

No two companies are alike. In large businesses, like I said, Apple's server GUIs are usually pretty useless, as services like DHCP, DNS, mail, LDAP, etc. are usually populated and maintained by a series of automated scripting that is very specific to a particular environment. In large businesses, they are usually separate departments that handle things such as identity management, possibly security policy, HR stuff, etc. Apple cannot design a just-add-water GUI for all of these sorts of environments, and I'm certain that they know this given how OS X Server is designed.

Without Apple's GUIs, you are left with a command line based environment, and OS X is not a particularly rich or well designed environment to use purely in this fashion compared to its competition. Sure, it *can* do the same sorts of things, but it is missing a lot of nice features such as open source package management (and Macports and Fink do not cut it). Put it this way: the compelling reason to use OS X Server over its competition are the GUIs Apple develops, in addition to the XServe if this hardware and price tag is compelling for the needs of your environment.

In a CLI-only environment, I'd argue that the costs of running OS X Server are even higher. For one, who uses OS X Server this way anyway? Have you ever seen a job description that listed using Pure Darwin or OS X Server minus Aqua? Secondly, lacking the aforementioned, how is time being saved? Even using Aqua, how often do you see a job listed on a site like Monster.com that demands OS X Server experience?

When it comes to OS X client, I can be more accepting of this sort of data, and if you are in an environment where you can use the GUIs Apple provides in OS X Server, perhaps I can also be understanding, but the world of business as a whole? Don't buy it at all.

[melgross]

Originally Posted by besson3c

I don't know how they arrive at their numbers, but I think that they are bogus.

No two companies are alike. In large businesses, like I said, Apple's server GUIs are usually pretty useless, as services like DHCP, DNS, mail, LDAP, etc. are usually populated and maintained by a series of automated scripting that is very specific to a particular environment. In large businesses, they are usually separate departments that handle things such as identity management, possibly security policy, HR stuff, etc. Apple cannot design a just-add-water GUI for all of these sorts of environments, and I'm certain that they know this given how OS X Server is designed.

Without Apple's GUIs, you are left with a command line based environment, and OS X is not a particularly rich or well designed environment to use purely in this fashion compared to its competition. Sure, it *can* do the same sorts of things, but it is missing a lot of nice features such as open source package management (and Macports and Fink do not cut it). Put it this way: the compelling reason to use OS X Server over its competition are the GUIs Apple develops, in addition to the XServe if this hardware and price tag is compelling for the needs of your environment.

In a CLI-only environment, I'd argue that the costs of running OS X Server are even higher. For one, who uses OS X Server this way anyway? Have you ever seen a job description that listed using Pure Darwin or OS X Server minus Aqua? Secondly, lacking the aforementioned, how is time being saved? Even using Aqua, how often do you see a job listed on a site like Monster.com that demands OS X Server experience?

When it comes to OS X client, I can be more accepting of this sort of data, and if you are in an environment where you can use the GUIs Apple provides in OS X Server, perhaps I can also be understanding, but the world of business as a whole? Don't buy it at all.

Unless you are involved in these metrics, your statements that they are bogus are more than a bit suspicious. Read some industry publicationss ,uch as Computerworld, or InfoWorld.

Industry spends many millions a year on evaluating matters such as this, and they have been doing it for over 50 years.

You are talking about one aspect of the equation, and as I said "Macs", you are not even addressing the statement I made. I discussed server problems earlier.

Go back to my post #15.