IDC: 'Linux will be $10bn market'

Sales of new and used PCs running the Linux operating system will reach $10bn by 2008, market researcher IDC predicted on Wednesday.

About 17 million Linux PCs will be sold that year, bringing the total installed base to 42.6 million, according to the IDC study. And though Linux on PCs is likely to be dwarfed by Windows, IDC forecasts a bigger beachhead: market share of new and used PCs running Linux is expected to grow from three per cent in 2003 to seven per cent in 2008.

Much of the industry outside Microsoft is a fan of Linux on desktop and laptop computers. Among companies with Linux PC efforts are Red Hat, Novell, Sun, Adobe, HP, IBM and Intel.

"For competitors and companies still on the sidelines, this forecast should provide additional justification to the market. Linux is no longer a fringe player. Linux is now mainstream," IDC said in a statement.

The forecasts are from an IDC study of the overall Linux ecosystem, including sales of Linux PCs, servers and packaged software running on those computers. IDC collected the data, but IDC analyst Al Gillen said that Open Source Development Labs (OSDL), a Linux consortium funded by major computing companies, funded IDC to integrate the data into a single study.

OSDL also publicised the story on Wednesday, providing some counterweight to Microsoft's "Get the Facts" campaign, which has funded research reports and sponsored advertisements to promote Windows at the expense of its rival Linux.

The IDC study estimates the overall Linux ecosystem will grow 25.9 per cent annually to reach $35.7bn in 2008. Of that, IDC estimates $14bn will be packaged software, $10bn PCs and $11bn servers.

For Linux PCs, market share will likely be lower than average in North and South America and higher in two other regions: Europe, the Middle East and Africa on the one hand and Asia-Pacific countries on the other, IDC forecast. In 2008, Linux PCs are expected to account for less than four per cent of unit shipments in the Americas and more than nine per cent in the other two regions.

Less than two weeks ago, IDC forecast the 2008 Linux server market will reach $9.1bn. That's less than the $11bn forecast in the newer study, chiefly because IDC counted money in a slightly different way.

In the earlier forecast, using IDC's standard methods, the researchers count a Linux server sale only if that's the primary operating system. In the newer study, IDC accounted for servers that run Linux alongside other operating systems, Gillen said. For example, with a mainframe on which Linux occupies half its computing capacity, half the cost would be allocated to Linux.

Linux is most widely used on servers using x86 chips such as Intel's Xeon and AMD's Opteron, but it also is supported on IBM's mainframes and Power processor based systems and on servers from HP and others using Intel's Itanium processor.

Stephen Shankland writes for CNET News.com.