Microsoft sees Windows gaining server market share

Seattle: Microsoft's Windows operating system for powerful computer servers will continue to take market share from Linux and Unix, the company's server and tools division head said.

The division has room for growth even in a slow US economy, said senior vice-president Bob Muglia.

The launch of Windows Server 2008, an upgrade of its system for running major business computers, will help Microsoft extend a trend of taking market share from upstart Linux and long-time competitor Unix, he said.

"In the last six months, we have seen [market share gains] accelerate," Muglia said during a launch event for Windows Server 2008. "We do see that continuing."

According to research firm Gartner, the Windows share of global server shipments gained a percentage point to 66.8 per cent in 2007 from a year earlier.

Open-source Linux's share fell by a percentage point to 23.2 per cent last year and Unix dropped to 6.8 per cent in 2007 from 8.1 per cent in 2006.

Microsoft has benefited, according to Forrester analyst Chris Voce, by improving its offering for servers used to host websites.

Many developers had opted for a software bundle based of open-source offerings such as Linux, Apache web server and Sun Microsystems's MySQL database management.

Windows Server 2008, the successor to Windows Server 2003, is the headline product of an upgrade cycle at Microsoft's server and tools division, a unit that has posted revenue growth of more than 10 per cent in 22 straight quarters.

Later this year, Microsoft plans to introduce the latest version of its SQL Server database software.

The $11.2 billion server and tools division accounts for more than 20 per cent of Microsoft's revenue and profit and is its biggest business aside from Office and Windows.

Muglia, a 20-year Micro-soft veteran who runs the division and reports to CEO Steve Ballmer, shrug-ged off the possible negative impact from a US technology spending slowdown, saying about 60 per cent of division sales come from overseas.

In markets like Russia, China and India, demand is strong, Muglia said. Furthermore, Microsoft only accounts for a fraction of the $80 billion global server and tools market, providing the company with ample growth opportunity.

"Overall, we continue to see strong growth," Muglia said.

Asked about potential clouds on the horizon, Muglia said a proliferation of Web-based services could mean corporate customers would need less server software from Microsoft or others because they would not run their own data centres.