Asia Pacific server spending declines for first time since dot.com 2001 meltdown

Peter Dinham
Wednesday, 25 March 2009 09:30

IT Industry - Deals

Server shipments have plummeted in the Asia Pacific region as the economic crisis sweeping the region and the rest of the world worsens.

After 25 consecutive quarters of strong growth since the second quarter of 2002, server shipments in the region (excluding Japan) have dropped rapidly by 4.6% year-on-year, with the decline in the fourth quarter last year the most dramatic with a double digit contraction for the second consecutive quarter.

In its quarterly enterprise server tracker report just released, IDC says the Q4 2008 contraction dragged the total spending for the full year 2008 down by 4.9%.

IDC’s Rajnish Arora, director of Asia/Pacific enterprise servers & workstations research, says the malaise of the economic and financial crisis in the US and Europe quickly spread across the Asia/Pacific region causing a debilitating slowdown in server spending in Q4 2008 with almost every country witnessing steep double digit declines, with the exception of China, Thailand and Vietnam which registered modest single digit declines on an annual basis.
 
"It was an absolutely nerve wrecking quarter when six of the top seven markets witnessed almost a third of server spending plunge on a year-on-year basis.

"The modest, single-digit decline in server spending in 2H 2008 in the China was expected after an astounding 30% surge in 2H 2007 underpinned by massive infrastructure buildout in the run up to the Olympics."

According to Rajnish, the resiliency of the Singapore server market seemed like a mirage in Q4 2008 with shipments plunging 19.6% year-on-year after two consecutive quarters of healthy double-digit increases since Q2 2008.
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