17 June 2004 Companies are expected to spend $53 billion on servers worldwide by the end of 2004, a rise of 5% on last year, according to market researcher IDC.

The predicted increase in server spending is thanks to hardware and software migration and replacement, as well as growing demand in developing countries, says IDC.

IDC’s Steve Josselyn says the US and western Europe will continue to hold the greatest share of the market, while the most rapid growth is predicted from emerging markets, such as central and eastern Europe and the Asia/Pacific market.

Steady growth will continue for the foreseeable future, says IDC, with the market expected to reach about $60.8 billion by 2008.

The IDC research has found that demand for Unix-based servers is still strong, despite growing competition from Linux alternatives. The Unix server segment will amount to $19.4 billion by the end of 2004, or 37% of the market as a whole, says IDC.

However, Unix sales are expected to decline by 6%, as more users migrate to Linux-based severs. The Linux server segment, for its part, is expected to yield $3.2 billion in sales in 2004. Linux is currently enjoying an annual growth rate of almost 50%, and is expected to capture 29% of the market by 2008, nearly tripling its current market share.

In particular, customers are increasingly asking for a particular Linux-based server application that includes clustering configurations used to carry out high-performance computational tasks, says IDC.

Blade servers are deemed to be the market with the most potential for growth, with sales expected to reach $9 billion by 2008.