Long growth cycle comes to abrupt halt for Asia Pacific server shipments

Peter Dinham
Tuesday, 10 March 2009 17:29

IT Industry - Deals

After twenty-seven quarters of steady growth there’s now been a damaging decline in server shipments in the Asia Pacific region, down 5.8 percent year-on-year, and with a major impact on revenues across the main five APAC sub regions.

The decline in IT spending that first showed itself during the third quarter gathered steam in the fourth quarter in Asia Pacific under the impact of the global economic recession, according to Gartner in its latest market survey.

Gartner’s principal research analyst for server markets, Erica Gadjuli, said that in fourth quarter 2008, the year-on-year revenue decline occurred across five Asia Pacific sub-regions, including Greater China (-6.7 percent),  Australia and New Zealand (-36.5 percent), India (-18.1 percent), Korea (-28.3 percent) and South East Asia (-15.2 percent).
 
Gadjuli says that mature markets like Australia, Hong Kong, Singapore and Taiwan were impacted more deeply than emerging markets, with double digit year-on-year decline in the fourth quarter and for the full year 2008.

“The poor fourth quarter results did not totally negate the overall increase in shipments for the year, as Asia Pacific ended the year on a positive note with growth of 6.5 percent. However, revenue for the year fell by 2.8 percent.”
 
The Gartner survey found that IBM continued to lead the Asia Pac server market, followed by HP, Dell, Sun Microsystems and Lenovo, with the top five vendors accounting for 92.8 percent of the revenue share collectively in the fourth quarter 2008 and 92 percent in overall.
 
Gadjuli said that during the fourth quarter, fierce price competition in the x86 server space throughout the region and notable sharp price cuts, particularly in the high end platforms, resulted in faster x86 server revenue decline of 17.7 percent, while shipments fell 5.4 percent year-on-year. HP maintained its leadership in this platform in both unit shipments and revenue.

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