Time was, it was easy to tell what a workstation was: It was a desktop system with a huge monitor and a SPARC processor that ran Unix or Windows NT and cost a few hundred thousand dollars. Now it isn't so simple. With their 3GHz processors and fast 3D graphics cards, today's high-end PCs can match the performance of the workstations of just a few years ago. But there's a lot more to a workstation than just the speed of its CPU. Although workstations may share some PC components -- and even pricing -- the workstation segment remains unique.

IDC stays on top of the evolving market by allowing vendors to define what is a workstation and what isn't: "We count any system that a vendor sells and markets as a workstation as a workstation," says Kara Yokley, an analyst at the Framingham, Mass.-based research firm who covers the technical computing sector.

Workstations are specialized desktop -- and, more recently, portable -- computers designed and tested for a limited set of very demanding applications. Historically, these systems have used proprietary architectures, like Compaq's Alpha or Sun's UltraSPARC, and run variants of the Unix operating system.

These systems are used for a variety of scientific and technical applications -- from the mundane, such as desktop publishing, to the arcane, such as searching for pockets of natural gas hidden beneath the earth. Workstations also drive most computer-aided design (CAD), digital content creation (DCC), and financial analysis, and anything that requires serious number-crunching. Now however, a new breed of workstation is on the market, made by famous-for-PC firms like Dell, IBM, and HP. And they look a lot like PCs, albeit very sophisticated ones.

More Than a Box

As the performance of general-purpose PCs increases, "civilian" systems are putting pressure on workstation sales. "We are seeing more and more crossover," says Yokely. With high-end PC processors, graphics cards, and hard disks finding their way into workstations, "the real difference between PCs and workstations is the effort vendors put into certification and marketing."

Independent software vendor (ISV) certification requires the workstation manufacturer to test a given configuration to make sure it will run a specific application seamlessly. "Workstations imply a higher level of usability and compatibility than regular PCs, because the vendor has to make an effort to get application certification," Yokley explains.

Since ISV certification saves the customer a lot of time and money configuring his or her own system, "people are willing to spend a little extra for ISV certification and greater services," says Yokley. The key phrase there is "a little extra" -- while more workstations were sold last year than in any previous year, IDC says overall market revenues were down, largely because a workstation that cost $250,000 five years ago now sells for around $20,000.

The price decline is because the cost of components used to build ultra-high-performance systems has dropped. Instead of proprietary architectures and custom-made components, workstations are increasingly built with off-the-shelf parts. As a result, IDC predicts that despite increasing unit sales, total dollar sales for the workstation market will drop from $5.1 billion in 2002 to $2.7 billion in 2007.

The types of workstations sold will also be changing in the next few years. The traditional Unix/RISC segment will see the most substantial decline: Although such systems accounted for $2.1 billion in sales last year, IDC expects them to yield only $233 million by 2007. And according to IDC, revenues for branded personal workstations running Windows or Linux on 32-bit Intel and compatible processors (what tech watchers call IA32 architecture) will drop, too, from $3 billion in 2002 to $2.1 billion in 2007.

By contrast, what IDC calls "the commodity 64-bit workstation market" is poised for growth. These systems combine Intel Itanium or AMD Opteron processors with relatively generic, albeit sophisticated, components; sales are projected to grow from a modest $35 million last year to $343 million in 2007.