India Server Shipments recorded an almost flat performance and a revenue decline of 3.5% in the first quarter of 2007, according to Gartner. The Indian server market revenues totaled US$ 135.6 million as server shipments reached 27,980 units.
In India , with total revenues of US$ 71.1 million the x-86 segment revenues saw a decline of 9.3%, coupled with a decline in shipments. With revenue of US$ 64.5 Mn, the RISC/Itanium/Others market reported a marginal increase of 3.9% annually, during the first quarter of 2007. “The competition remains intense in this portion of the market as it continues to face declines. This indicates the fact that the later segment has reported better traction in the market place-primarily driven by server consolidation, data centre installation, etc. The overall server market could not meet the expectations as few of the large deals in select verticals reported a longer gestation period. Mid-market expansion and success has been the key characteristic of this quarter across server technology segments”, according to Naveen Mishra, senior analyst for Gartner's server market group.
"Worldwide x86 servers had been constrained in the fourth quarter of 2006 due to the lengthening sales cycles, following a period of particularly rapid technology transition,” said Jeffrey Hewitt, Research Vice President at Gartner. “As we had predicted, this constraint was less about virtualization and was only a temporary issue as evidenced by the fact that this part of the market returned to growth in the first quarter.”
In India, although the overall server market declined by 3.5% in terms of revenue, IBM managed to perform better than the industry average with 11.6% annual growth rate. This helped IBM clinch the top spot in the server market, with Hewlett Packard in a close second position followed by Sun Microsystems . With fourth position in terms of revenue, Dell has posted an impressive quarter as compared to last year with 31.2% growth as compared to the same quarter last year.
The BFSI and Telecommunications sectors continue to be the key spenders, though they have been sluggish this quarter. Manufacturing has performed well owing to mid-market success in the country during the quarter. Education and government continue to be the emerging verticals for servers in the country.
Asia Pacific server market
Asia Pacific server shipments were up 3.1 percent, while industry revenue posted a 15.1 percent increase in first quarter 2007. Server revenues totaled US$1.7 billion for the quarter, as server shipments reached 298,956 units.
Servers shipped to Korea had the strongest year on year growth of 19.1 percent this quarter as compare to other sub-regions, accounting for 9.5 percent of the total volume in Asia Pacific for the first quarter. In revenue, ANZ and Greater China experienced double digit increase from the same period last year with 47.1 percent and 23.0 percent correspondingly.
The overall x86 servers shipment grew 3.6 percent and revenue climbed 12.7 percent annually. We have observed the trend of faster revenue growth rate than the unit shipment since last quarter which clearly confirmed a further market demand shift towards the 2-way and 4-ways servers. Meanwhile the dual core is now the main stream in this platform.
“Aligned with our expectation, the Blade servers continued to be one of the growth drivers in x86 server platforms during the first quarter”. HP took over the leadership in blade server market from IBM this quarter, in both shipment and revenue term.
RISC-Itanium Unix servers continued to show positive growth of 12.7 percent in revenue in the first quarter 2007. This particular platform experienced healthy year on year revenue growth in ANZ, Greater China and India. “For the RISC platform particularly, we are seeing IBM and Sun Microsystems lead the growth game in revenue this quarter while the competition generally remain intense.”
IBM was the market leader in the Asia Pacific server market overall based on revenue during the quarter. Except for System i, IBM's revenue increased for the quarter in System p, System x and System z and recorded overall revenue increase of 17.3 percent for the quarter. Despite its lost in the overall server market share to HP in this quarter, IBM continued to see the blade server growth in Korea and ANZ.
Hewlett-Packard remains to hold the number one position in server volume by growing 21.8 percent from the same period 2006, which is faster than the total market growth rate, and its market share increased by 5 point. Similarly, HP saw healthy increased in its revenue of18.1 percent in annual basis, thanks to its Integrity server line which contributed 22 percent of HP total revenue in the first quarter 2007, rising 73 percent from the same period last year. Furthermore, the ProLiant server was experiencing year on year growth of 24 percent in shipment and 27 percent in revenue during the quarter.
Another healthy revenue and shipment growth performance from Sun Microsystems in the first quarter 2007 which has been demonstrated for four consecutive quarters. Sun, in third place for revenue contribution, had the most significant annual growth of 29.7 percent amongst the top five server vendors in Asia / Pacific marketplace during the quarter.
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