Server market takes a tumble

Davey Winder
Friday, 05 December 2008 15:44

IT Industry - Market

File under no surprise there then: the latest IDC EMEA Server Tracker figures, factory revenue in the EMEA server market has shown the biggest quarterly decline since 2005, and Western Europe is to blame.

What a difference a few months make. Was it really only in June that we were being told that the credit crunch will not impact upon IT spending? Or in July that global consumer electronics spending will rise by ten percent?

Mind you, when you have one report insisting that IT outsourcing will be the big credit crunch winner and another revealing how outsourcing has hit a six year low it becomes obvious that the economy has analysts running around like headless chickens.

There can be no arguing with the EMEA Quarterly Server Tracker from IDC though, which does away with the opinion and just reports on the bottom line. And that bottom line is, quite simply, that server market revenue fell by some 3.8 percent in the third quarter of 2008.

The fact of the matter is that this marks the largest quarterly revenue decline since the fourth quarter of 2005, dropping year on year to nearly USD $4 billion despite server shipments actually being up by 4.9 percent on the same period to exceed 650,000 units.

IDC puts the blame squarely on a slowdown in the technology spending of large European economies.

To be more precise, it is all the fault of Western Europe. Server sales here saw the sharpest deceleration with revenues down by 7.6 percent to nearly USD $3 billion, with unit shipments down 0.6 percent as well.

Nathaniel Martinez, director of European Enterprise Servers at IDC says that "the economic downturn is forcing European companies to slow their server spending and review their buying behavior. Large organizations are launching internal asset inventory projects before committing to any purchases, while organizations in most sectors are focusing on projects that reduce costs rather than adding new capacity."
 
How did bladed servers fare, what about Windows, and what do the figures look like for individual vendors? More detail from the report on page 2...

CONTINUES