IBM Extends Server Lead with 6.5 Point Market Share Gain Year to Year; Sun Plummets 6.3 Points

IDC Reports IBM Number One Server Company, Outselling Sun by 113 percent

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ARMONK, N.Y - 07 Dec 2001: International Data Corporation (IDC) reported today that in the third quarter of 2001, IBM enhanced its position as the number one server vendor worldwide. IBM gained six-and-a-half points of revenue market share in the quarter year over year, outselling rival Sun Microsystems by a 113 percent margin. Sun lost 6.3 points of worldwide market share year over year.

IBM's market share gains coincided with the one-year anniversary of IBM eServer[1], a new generation of powerful servers with mainframe-class reliability, support for open standards and unmatched scalability and performance.

In the third quarter of 2001, IBM had 26.3 percent of the worldwide server market on a revenue basis, compared to Sun's 12.3 percent, according to IDC. In the third quarter of 2000, IBM had 19.8 percent versus 18.6 percent for Sun, IDC said.

According to IDC's Quarterly Server Tracker, IBM had worldwide server factory revenue in the third quarter of $2.826 billion compared to $1.327 billion for Sun. IBM's worldwide leadership over Sun also extended to server shipments, with IDC reporting that IBM shipped 140,846 servers in the quarter, compared to Sun's 62,511 shipments.

In the worldwide UNIX[r] market segment, IDC indicated that IBM gained 5.6 points of revenue share, from 15.3 to 20.9 percent year over year; while indicating Sun's market share plummeted 10.2 points, from 39 to 28.8 percent year over year.

Also, as a result of a strong push with its eServer xSeries[tm] systems, IBM gained revenue share in the worldwide market segment for Intel processor-based servers in consecutive quarters (2Q01 to 3Q01) -- from 12.8 percent to 13.9 percent. IBM demonstrated notable strength in the United States, gaining 2.7 points of Intel market segment share from the second to the third quarter -- from 8.4 to 11.1 percent.

IBM's success is attributed to a number of key factors:

IBM eServer -- Introduced in October 2000, IBM eServer is a new generation of servers featuring mainframe-class reliability and scalability, broad support of open standards for the development of new applications, and capacity on demand for managing the unprecedented demands of e-business. The IBM eServer line provides flexibility to help customers build and manage e-business infrastructures affordably and effectively.

Technology leadership-First to include technical innovations like microchips powered by IBM Copper and Silicon-on-insulator technology, IBM eServer UNIX servers rank number one in important performance benchmarks. IBM Intel processor-based servers incorporate features designed to provide mainframe-like reliability and availability.

Strategic alliance strategy-Since IBM established a policy of partnering with leading software applications vendors like Siebel and SAP, these vendors often lead in sales engagements with IBM servers and software.

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[1] IBM, the e-business logo, and xSeries are trademarks or registered trademarks International Business Machines Corporation in the United States and other countries. UNIX is a registered trademark of The Open Group.