Server Operating System Market Volume, Share & COVID-19 Impact Analysis, By Operating System (Windows, Linux, UNIX, and Others), By Virtualization Status (Virtual Machine, Physical, and Virtualized), By Subscription Model (Non-paid Subscription and Paid Subscription), By Enterprise Type (Large Enterprises and Small & Medium Enterprises), and Regional Forecast, 2023-2030

The global server operating system market volume was 21,578 thousand in 2022 and is projected to grow from 23,752 thousand in 2023 to 54,748 thousand by 2030, exhibiting a CAGR of 12.7% during the forecast period.

Key players in the market are developing advanced server-based operating systems for web servers that function in a client/server architecture to cater to the demand for computers on the network. Servers including web, mail, file, database, application, and print rely on operating systems to assist users with various functions. Windows Server, MacOS X Server, and Linux versions, such as Red Hat Enterprise Linux (RHEL) and SUSE Linux based Enterprise Server OS are the popular operating systems for a wide range of applications in data centers. A server operating system assists organizations in running large programs and handling complex tasks, such as data transfers. Also, the rising adoption of cloud platforms and data center infrastructure is driving the demand for server OS. Thus, with the rise in usage of virtual or cloud-based solutions, companies are keen on offering advanced server OS. For instance,

• November 2021 - Red Hat, Inc., an operating system solutions provider, launched an advanced version of the Linux 8.5 Red Hat Enterprises Linux platform. This Linux operating system platform offers extended functionality across data centers, clouds, and traditional data center operations. The platform enables IT teams to expand their capabilities to build transformative applications required for businesses.

COVID-19 IMPACT

Declined Spending on Data Center Infrastructure Decreased Demand during Pandemic

The COVID-19 pandemic caused significant disruption across all industries in the global economy, which resulted in severe recessions across the world. The pandemic caused around 4.3% contraction in the world’s gross domestic product in 2020, according to the United Nations Conference on Trade and Development (UNCTAD).

Furthermore, the outbreak declined the overall end-user spending on data center infrastructure. According to Gartner Inc., end-users’ expenditure on data center infrastructure was reduced by around 10.3% in 2020 owing to cash flow constraints during the pandemic. Also, this period caused a major decline in overall IT spending.

Based on the above factors, the spending on global IT technology declined during the COVID-19 outbreak in the short term. This factor weakened the global server operating system market growth. However, growing shift of enterprises toward cloud systems, rising work from home & BYOD trends, and other factors are expected to strengthen the market during the forecast period. According to Right Scale’s Report for 2019, 91% of businesses used public cloud service and 72% used the private cloud. Thus, in the long-term, considering their vast benefits, the demand for server OS is expected to grow significantly.

LATEST TRENDS

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Increasing Adoption of Hybrid Cloud Environments for Server Infrastructure to Support Market Growth

Globally, enterprises are adopting hybrid and public cloud-based applications to meet their business requirements. The rising number of cloud-based server users and surge in enterprise spending on embracing cloud services have propelled the market growth. According to a Forbes survey, in 2020, enterprises across the world invested around USD 12 million annually on cloud services.

Many companies in the market are deploying cloud-based applications for accessing the web-based application to store data from a remote server with the help of software and hardware resources. According to the IDC predictions, more than 40% of enterprise applications will be deployed on cloud infrastructure by 2024. Furthermore, increasing adoption of Linux-based operating systems, with the surge in server deployments by enterprises, is expected to boost the server operating system market share.

DRIVING FACTORS

Rising Adoption of Cloud Platform and Infrastructure to Surge Demand for Server OS

Rising adoption of cloud platform & infrastructure and surging data center infrastructure investments by the leading players are aiding the market growth. The expansion of current advanced infrastructure is expected to boost the number of cloud server users across the globe. The key cloud computing service providers are investing a considerable amount of money in the development of cloud infrastructure around the globe. For instance,

• In February 2023, Oracle Corporation announced a new plan of public cloud in Saudi Arabia with an investment of USD 1.5 billion, considering the increasing demand for cloud services.


• In July 2021, Google LLC launched an advanced cloud infrastructure development project in India. Similarly, in the earlier year, the company invested around USD 4.5 billion in Jio Platforms to push digitization efforts in the country. In July 2021, Google LLC had around 79 cloud zones, 26 cloud regions, and 146 cloud availability points across the world.

Thus, the server operating system provides several functionalities for a data center such as a central interface for managing multiple users, implementing security solutions, and other administrative processes. An increase in data center deployments across the globe, owing to a surge in the adoption of managed services has propelled the global market share.

RESTRAINING FACTORS

High Server Downtime and Costs Related to Deployment May Hinder Market Growth

High costs related to server downtime of operating systems and deployment can hinder the market growth. According to the Information Technology Intelligence Consulting Corporation (ITIC), in 2020, downtime costs for a single server were valued at around USD 100,000 for one hour of downtime that was relatively expensive. However, the server downtime cost was valued at USD 1,670 per minute/per server. Also, around 88% of the respondents’ calculated one-hour downtime costs for the companies is USD 301,000 or more. Such a high cost of server downtime might hinder the server OS market growth.

SEGMENTATION

By Operating System Analysis

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Linux Segment Captured Largest Market Share Owing to Diverse Product Advantages

By operating system, the market is divided into Windows, Linux, UNIX, and others.

The Linux segment is expected to hold the largest market share during the forecast period. This high demand is owing to the product’s advantages including open source, low cost, strong performance, compatibility, and security. Further, the Windows segment is anticipated to grow at a significant rate owing to advanced multi-layer security and modernization of workloads on Azure on cloud and on-premises.

UNIX and others segments are expected to demonstrate significant growth rate during the forecast years as they provide multitasking and multi-user capabilities. UNIX is an extensively used operating system across computing mobile devices including desktop operating systems, netbooks, and server systems.

By Virtualization Status Analysis

Enhanced Flexible Capabilities of Virtual Machine Analytics to Drive Market Growth

Based on virtualization status, the market for server operating system is divided into virtual machine, physical, and virtualized.

The virtual machine segment captured maximum market share in 2021, as the primary goal of Virtual Machines (VMs) is to run an operating system from the same hardware at the same time. Without virtualization, running several OS, such as Linux Kernel and Windows would need the use of two distinct physical units. The physical and virtualized segments are expected to record a significant CAGR during the forecast period.

By Subscription Model Analysis

Diversity in Services to Fuel Adoption of Paid Subscription-based Operating System

By subscription model, the market is divided into paid subscription and non-paid subscription.  

The paid subscription segment is set to dominate the market share during the forecast period. It offers highly secured and efficient performance to clients. Paid subscription includes maintenance, upgradation, technical support, and many other services. Thus, with the increasing cyber threats, industries are keen on implementing the paid subscription model.

The non-paid subscription segment is predicted to showcase rapid growth rate during the forecast period. Small and medium-sized enterprises or companies with limited IT funding are adopting non-paid subscription models.

By Enterprise Type Analysis

Growing IT Funding to Boost Product Adoption in Large Enterprises

By enterprise type, the market is segmented into large enterprises and small & medium enterprises.

Large enterprises segment to hold dominant market share during the forecast period owing to the rise in adoption of cloud platforms. It requires higher security, stability, and volume, thus, the investment in server operating system is expected to increase.

Small & medium enterprises segment is also adopting the operating system on cloud server instead of investing in on-premises server. It requires less on-board staff to maintain and properly run the server, thus making the deployment cost efficient.

REGIONAL INSIGHTS

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The report’s scope includes three major regions, the Americas, Europe, Middle East & Africa, and Asia Pacific.

The Americas region is expected to dominate the global market owing to the increasing demand for server OS and surging online applications. A server operating system is used to manage several applications, such as storage management, server management, and others using AI technology. Furthermore, government investments across the region are anticipated to drive the market growth.

Similarly, Asia Pacific is anticipated to showcase the highest CAGR during the forecast period. The increasing number of data centers with a surge in investments by leading players in Asia Pacific will drive the market. India and China have the highest number of colocation data centers, 160 and 87, respectively. An increase in the digital technology penetration in countries, such as India, China, Japan, and others is expected to create ample opportunity for key players in the market. The computing systems in the colocation data centers use server-based operating systems. Hence, it is expected to drive the market growth in these countries.

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Europe and the Middle East & Africa regions are likely to showcase a considerable CAGR in the global market. An increase in overall ICT spending across Europe has increased the demand for server operating systems to assist organizations in the digital transformation of businesses. According to Forrester's Data Center Map, there are more than 139 colocation data centers in 16 countries across the Middle East. An increase in the number of colocation data centers is expected to create ample opportunity for the key players in the market.

KEY INDUSTRY PLAYERS

Emphasis of Key Players on Developing Server Operating Systems to Strengthen Market Competition

The companies operating in the market, such as Google LLC (Alphabet Inc.), Microsoft Corporation, Amazon Web Services (AWS), IBM Corporation (Red Hat, Inc.), and others, are developing OS integrated with advanced technologies.

September 2021 – Microsoft Corporation launched an advanced windows server that claimed to deliver innovation in hybrid, security, and containers. The server, known as Windows Server 2022, offers scalability improvements such as support for 2,048 logical cores running on 64 physical support and 48TB of memory support.

November 2021 – Red Hat Enterprise Linux (RHEL) launched the 9 Beta version with advanced features and improvements. RHEL Beta 9 was created on kernel upstream type 5.14 and offers a preview of major updates of RHEL. This is designed for hybrid multi-cloud deployments, on-premises, physical, public cloud, and edge computing.

List of the Key Companies Profiled:

• Microsoft Corporation (U.S.)


• Red Hat, Inc. (IBM Corporation) (U.S.)


• Google LLC (U.S.)


• Amazon Web Services, Inc. (U.S.)


• Fujitsu Ltd. (Japan)


• NEC Corporation (Japan)


• Apple Inc. (U.S.)


• Hewlett Packard Enterprise (U.S.)


• Dell Technologies Inc. (U.S.)


• Canonical Ltd. (U.K.)

KEY INDUSTRY DEVELOPMENTS:

• November 2022 – Microsoft Corporation introduced SQL server 2022 platform for on-premises and cloud services. Through this launch, enterprises using on-premises deployment models can access cloud solutions and then easily move to cloud when required.


• May 2022 – Red Hat, Inc. announced collaboration with Samsung Electronics Co., Ltd. to work on next-generation memory software that helps the software and hardware perform better across a diverse server environment.


• May 2022 – Red Hat, Inc. announced its strategic partnership with General Motors to help with its Red Hat In-Vehicle Operating System. General Motors’ Ultifi software platform requires robust cybersecurity protection and for this, RedHat is providing its certified Linux-based system.


• January 2022 – Amazon Web Services Inc. launched a speed optimization solution for Microsoft Windows Server on Amazon EC2. Microsoft Windows Server claims to provide 65% faster speed on Amazon’s Elastic Computing Cloud (EC2).


• September 2021 – Fujitsu Limited server PRIMERGY was certified for server operating systems Windows Server 2022. The server provided secured remote working through multi-layer security along with a flexible platform for IT migration.

REPORT COVERAGE

An Infographic Representation of Server Operating System Market

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The research report provides an in-depth analysis of the market. It focuses on key aspects, such as leading companies and top product applications. Besides this, the report offers insights into the latest market trends and highlights key industry developments. In addition to the factors mentioned above, the report encompasses several key factors contributing to the market's growth in recent years.

Report Scope and Segmentation