Incumbent Gains Breathing Room Over Linux

Runner-up Novell displaced Hewlett-Packard, taking second with NetWare 6.5. Novell's SuSE distribution of Linux emerged on the ARC radar screen for the first time, finishing third. HP and its HP-UX version of Unix dipped to fourth, from second in 2003, and litigation-prone SCO sagged one notch to fifth.

Microsoft's ARC win was propelled by its strong marketing support and partnership scores, two factors VARs see as their salvation as Windows works to fend off incursions from Linux.

"[Microsoft's] VAR team is one of the few groups inside Microsoft that really understands the channel," says Ric Opal, vice president of Peters and Associates, a VAR in Elmhurst, Ill. "They'll do whatever it takes, regardless of their quotas."

Microsoft also helps the likes of Peters and Associates make its case with the help of a "Delta Force"--a collection of technically knowledgeable sales consultants who swoop in and help make pitches to customers. "They're outstanding technical people," Opal says. "As a VAR, I'd like to see even more from that group."

ARC runner-up Novell has a two-pronged strategy to get more of the server market. On the NetWare front, it will key off the Windows-beating 81 it scored for product quality/reliability to begin to migrate its installed base of more than 20,000 customers to a new product called Open Enterprise Server, which combines NetWare with Linux. Separately, Novell will work to market SuSE Linux as a standalone product. Novell boarded the SuSE bandwagon when it purchased the company for $210 million in November 2003. Nevertheless, SuSE finished a strong third, vaunted to that spot in part by its strong scores for technical innovation and product quality/reliability (scoring a 71 for both criteria).

As for HP, its fourth-place finish for HP-UX may have more to do with the fading fortunes of Unix in the face of Linux than with any HP shortfall. Still, the company posted a strong showing in the ease-of-doing-business and profit potential criteria (60 and 62, respectively), indicating there's some life in the old OS yet.

"There's a maturity and robustness aspect to HP-UX that's not yet matched in the other OSs," says Brian Cox, worldwide product line manager for HP's enterprise servers. "Customers recognize the value it has for large, back-end databases and other mission-critical applications."

Moving forward, if Microsoft wants to reprise its victory in next year's ARC, it will have to give its partners incremental technology upgrades to keep Windows Server on the cutting edge until its next-generation Longhorn OS is ready. "We're at a critical juncture," Peters and Associates' Opal says. "Core Microsoft [resellers] have to [wonder] what happens when Windows Server 2003 saturates the market?"