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-- by Joseph C. Panettieri and Diganta Majumder
The day Microsoft shipped Windows NT 3.1, many technology pundits began the UNIX death watch. But while NT hasn't come close to killing its competitors, the Microsoft OS is starting to put the squeeze on UNIX.
On the desktop, annual PC workstation sales (831,000 units running primarily NT) surpassed UNIX (712,000) for the first time last year, according to International Data Corp. (IDC), a high-technology market researcher. "Windows NT is making inroads into selected UNIX markets, such as financial services, animation and CAD," said Thomas G. Copeland, IDC research director. "However, traditional UNIX vendors are still holding their own. Users are not about to scrap their productive UNIX infrastructures overnight."
But they may do so over time. Several large companies, including Bankers Trust, Merrill Lynch and Smith Barney, say they're abandoning their expensive UNIX desktops in favor of less-costly NT workstations. Similarly, Alcoa (the Aluminum Company of America) is deploying NT across 10,000 workstations and 450 department servers, but plans to retain Hewlett-Packard's HP-UX on central office servers. That's because NT can't match its scalability.
Cause for concern
These signs of NT's momentum clearly worry the UNIX industry. Most major players-Digital, HP, IBM, Tandem and NCR-are hedging their UNIX bets by supporting NT. Even the Santa Cruz Operation (SCO, the leading seller of UNIX) has de-emphasized its desktop offerings and retreated to the server. That leaves Sun Microsystems as the only big UNIX holdout. Perhaps because of the moves made by its rivals, Sun is enjoying record sales for its UNIX workstations and servers, and is pitching JavaStations (see this month's cover story) as an alternative to Windows-based PCs.
Microsoft also appears to be making inroads in other market segments. Windows NT Server (700,000+ units) outsold UNIX (600,000) for the first time last year, according to IDC. Even Netscape Communications says its server software sales are now split evenly between UNIX and NT.
Still, numbers can be a bit misleading. Sun, for instance, maintains that most NT Server wins come at the expense of IBM OS/2 Warp Server, Banyan Vines or Novell NetWare-not UNIX. Also, despite NT's growing popularity, UNIX server sales are actually rising. Small-scale (under $100,000) UNIX server revenue grew 22 percent to $11.1 billion in 1996, and midrange ($100,000 to $999,000) system revenue jumped 34 percent to $9 billion.
It's unclear exactly how long the NT/UNIX battle will go on, particularly at the high end. Microsoft says NT Server sales are doubling annually, and a host of new enterprise features, including clustering and mainframe connectivity software (see "Cedar Takes Root" in this section), are just around the corner. Of course, Microsoft has a tendency to say that a lot.