Report reveals upturn in workstation market

It might not be the soaring growth market it once was, but the results are in and 2005 was an outstanding year for workstations and professional graphics.

Jon Peddie Research has completed its market tabulations for Q4 2005 and the full calendar year as part of the latest instalment of its Workstation Report series.

Workstation vendors shipped roughly 2.1 million units in 2005, up 22.6% from 2004.

Revenue hit $5.3 billion for an 18.4% gain.

Why the dramatic uptick in 2005? The market is benefiting from looser IT budgets allowing system replacements to catch up with newer technologies, such as dual-core, 64bit and next-generation graphics.

That allowed ASPs for x86 based workstations to improve slightly while ASPs for traditional (RISC/Unix) platforms fell at a much slower rate than previous years.

The market got an extra shot in the arm from the mobile workstation segment, which remains red hot growing at a 72% clip.

Dell continues to dominate the workstation market with a share of about 39% in Q4 2005, down from 46% in Q1.

HP follows with 27% and has steadily closed the gap with Dell in recent quarters.

Lenovo, IBM, Fujitsu-Siemens and Sun round out the top six.

At least in part, HP can credit its support of AMD's Opteron, which slowly but surely is stealing share from Intel's Xeon as well as legacy RISC/Unix platforms.

With Opteron's 2.6% market share (units), AMD is still dwarfed by Intel, Dell's only supplier, but the trend lines are clearly in AMD's favour.

"If you extrapolate Opteron's better near 350% growth rate, then AMD is in the teens in a couple of years and putting a big dent in Intel's share", said Alex Herrera, JPR Senior Analyst and Workstation Report author.

"But in 2006, with the new Woodcrest processor and Glidewell platform promising dramatically improved system bandwidth, Intel should dramatically close the performance gap with Opteron, especially in dual-socket applications".

Nvidia continues to dominate the professional graphics market, which in 2005 saw 2.8 million total units (including mobile) and $909 million in revenue (add-in card only), both up substantially from 2004.

Nvidia shipped 70% of units, but more significantly thanks to its attention to the high-end segments, the company has grown its share of revenue to a commanding 79%.

ATI has increased its unit share over the past two years, now up to 23%, while Matrox and 3DLabs have seen their shares decline.

3DLabs market share drop to just 2% overall was particularly painful, no doubt leading to its departure from the market earlier this year.

Now in its third year, JPR's "Workstation report - professional computing markets and technologies" has established itself as the essential reference guide for hardware and software vendors and suppliers serving the workstation and professional graphics markets.

With in-depth attention to the vendors and technologies driving the workstation platform, as well as a detailed quarterly sizing of the marketplace for both workstations and professional graphics hardware, the JPR Workstation Report provides the most comprehensive assessment of professional client platforms.

Garnering special attention in the just-released April 2006 issue are the following topics: how Intel plans to address the AMD threat, in 2006 and beyond; how vendors are facing the challenge to raise performance while reining in power consumption; the hows and whys in the trend to multicore architectures; the role traditional proprietary workstations (RISC/Unix) will continue to play; the impact of the mobile platform in the marketplace; Intel's new core microarchitecture and its future impact in workstations; and the changing landscape in professional graphics, including the departure of 3DLabs.

The JPR Workstation Report is a semi-annual reporting service focusing on both the technologies and markets for professional workstations.

The April 2006 report contains approximately 428 pages, with 174 figures and 88 tables.

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