News

IDC Report Shows Server Markets Down Worldwide

• 06/19/2001

The sluggish U.S. economy proved to be a killjoy for the worldwide server market during the first quarter of 2001. IDC's Quarterly Server Tracker report shows Dell and IBM were the only two major manufacturers to post worldwide gains.

According to IDC, factory revenues for the industry declined four percent from $13.8 billion in the first quarter of 2000 to $13.3 billion in the first quarter of 2001. In the U.S. market, the descent was more precipitous as revenues fell 16 percent from $5.2 billion in the first quarter of 2000 to $4.4 billion in the first quarter of 2001.

"Though the decline in the U.S. market was quite severe, strong growth in other parts of the world such as Western Europe and Asia/Pacific kept worldwide damage in check," said Vernon Turner, IDC's vice president of Global Enterprise Server Solutions in a statement.

IDC’s research shows Western European server factory revenues rose 16 percent year-on-year in the first quarter of 2001. Positive growth in Asia/Pacific, excluding Japan, was also strong at 12 percent. The server market in Japan, however, was impacted by a cutback in government spending and the declining value of the yen, causing revenues to stumble 12 percent from the year-ago quarter.

Despite declining revenues in the overall server market, the rack-optimized segment showed substantial gains. Shipments jumped almost 138 percent, causing revenues in this segment to spike 87 percent. In comparison, revenues in the non-rack-optimized server market fell 9 percent.

In terms of vendor performance, IBM and Dell were the only top-five players to increase their revenues in the worldwide market, with 13 percent and 21 percent jumps, respectively. IDC rates the top five vendors in the worldwide market according to revenue share as follows:

1. IBM 25%
2. Hewlett-Packard 16%
3. Sun Microsystems 15.4%
4. Compaq 14.7%
5. Dell 7%

In the U.S. market, Dell was the only top-five vendor to increase its revenues with 12 percent growth. According to IDC, the top five U.S. vendors by revenue share are as follows:

1. IBM 22%
2. Sun Microsystems 18%
3. Hewlett-Packard 16.3%
4. Compaq 15.9%
5. Dell 12%