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Follow UsAccording to Gartner, Asia/Pacific server revenue in the first half of 2005 grew 12.9% compared to the first half of 2004. In the second quarter alone, the growth of server revenue was reported at 15.8% year-over-year (see Table 1).
“China, Korea and Australia continue to be the largest server markets in terms of revenue,” said Annie Chung, Principal Analyst of enterprise systems at Gartner. “Together, they contributed 67% of total Asia/Pacific server revenue in this second quarter.”
Annie said the telecommunications, government and education sectors led the market growth in China. Server revenue grew 22.1% to $601 million as China continued to enjoy strong increases in gross domestic product (GDP). Rising oil prices and the revaluation of RMB had minimal impact on IT spending in the quarter.
South Korea was second to China in Asia/Pacific, with 14.9% market share. Revenue growth in the quarter was 5.5% compared to the same quarter last year. “While there are some downsizing issues in the high-end market, demand from manufacturers and small- and medium-sized enterprises (SMEs) is contributing to healthy growth for the x86-platform,” Annie said. “The government also is expected to contribute to an increase in server demand as it is embarking on an e-government initiative.”
In Australia, the server revenue grew 13.3% in the second quarter year on year. There was a strong demand in the enterprise market and government, as well as in the manufacturing, energy and education sectors.
India, the largest server market in the ASEAN region, continued to perform well, with revenues up 30% year-over-year. Its healthy economic conditions were reflected in increasing business confidence and foreign investment during the quarter. Server demand was strongest in banking, finance, manufacturing and services, with the public sector also active.
Singapore enjoyed a good second quarter due to strong growth in GDP, particularly in electronics and pharmaceutical manufacturing. Revenue increased 14.7%. “Government, telecommunication and financial services generated the strongest demand,” said Annie.
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Indonesia and the Philippines were among countries reporting revenue declines in the server market. Delayed IT spending by government-owned banks, financial institutions and other government-owned businesses was a major factor in Indonesia's decline. Large enterprises in the Philippines deferred long-term investments due to political instability in that country.
Servers running on Linux continue to gain ground in Asia/Pacific, contributing 7.2% of the total server revenue in the region compared to 5.1 % a year ago. An increasing share of non-x86 servers was installed with Linux, indicating that the adoption of Linux at the mid- to high-end is increasing.
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The top five vendors' ranking remained the same as the first quarter of 2005 (see Table 2). “IBM continues to lead in the region,” said Annie. “The outstanding performance of the IBM pSeries was a major growth factor for the quarter. Hewlett-Packard continues to be the leader in the x86 market, with strong demand from China and Australia in particular. Sun Microsystems' Asia Pacific server revenue was reduced by its performance in South Korea, but the company performed well in China and Australia.”
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