Worldwide server shipments spiked in 2005 with double digit growth, according to new research, with IBM and HP vying for top spot in revenue market share.

According to a newly released report from research group Gartner, server shipments increased 12.7% from 2004, while worldwide server revenue grew 4.5% in 2005.

"The most dynamic market remains the x86 server segment,” said Jeffrey Hewitt, research director at Gartner. “These servers continue to be the choice in increasing numbers to meet the needs of more Web users accessing more file types from more access points than ever.

“RISC-Itanium Unix servers fell 5.3% in shipments for the year and remained relatively flat with a 0.5% increase in revenue. The replacement at the low end of this market with Linux servers and declines at the high end of the market are the reasons for these results,” Mr Hewitt said. “Mainframes fell in revenue for 2005 (9.5% year over year), as all vendor revenue declined for the year including the mainframe leader, IBM, which declined 7.6%.”

IBM continued to lead the worldwide server market based on revenue, however the company ended the year with a revenue increase that slightly underperformed the market. Gartner analysts attribute the company’s performance to single-digit growth in iSeries and xSeries servers, while pSeries grew 15.1%, and zSeries declined 7%.

By revenue, IBM led with 32.1% marketshare, followed by HP with 28.2%. Dell and Sun were both well behind the two leaders, battling it out for third and fourth spot with 10.5% and 9.6% shares respectively. Fujitsu held the number five spot with 5.2% share of the market by revenue.