Factory revenue in the European server market dropped by 3.8 per cent year-on-year to nearly $4 billion (2.7 billion) in the third quarter (Q3) of 2008, according to the IDC Europe, Middle East and Africa (EMEA) Quarterly Server Tracker.
It said this marked the largest quarterly revenue decline since the fourth quarter of 2005, as technology spending in large European economies slowed down. This was despite the fact that server shipments were up 4.9 per cent on the same period, exceeding 650,000 units.
Server sales in Western Europe were no better, recording the strongest deceleration in the EMEA region, with revenue declining by 7.6 per cent annually, to just under $3 billion (2.04 billion), where units shipped were also down by 0.6 per cent.
"The data collected in IDC's Quarterly Server Tracker in 3Q08 reflects how the deteriorating economic conditions in Western Europe are having a direct impact on IT spending and changing the server market dynamics of the last couple of years," said Nathaniel Martinez, director of European Enterprise Servers at IDC.
Martinez added that the economic downturn is forcing European companies to slow their server spending and review their buying behaviour, which included the launch of internal asset inventory projects before committing to any purchases.
Split out by type, non-x86 servers declined by 6.3 per cent over the same quarter last year, with units declining by 16 per cent. Explicitly parallel instruction computing (EPIC) server revenue grew 16.3 per cent to over $400 million (272 million), while RISC suffered important annual losses of 15.5 per cent over the same quarter last year.
Revenue from x86 servers declined slightly by 1.7 per cent over the same quarter last year, but IDC said units rose six per cent to over 600,000 servers shipped in the EMEA region. Industry standard servers made 55.7 per cent of total revenue and accounted for 96 per cent of total units, while blade server sales performed well, rising 37.5 per cent annually.
The Tracker found all main operating systems (OS) suffered revenue losses except for Windows, whose growth was relatively flat, while IBM's z OS saw a healthy annual increase of 11 per cent. The drop in Linux revenue was very minor to a 15.3 per cent market share in EMEA, but Unix decreased by 5.7 per cent.
HP led the vendors in EMEA, with 2.4 per cent growth thanks, according to IDC, to strong sales of its industry standard Proliant line. IBM maintained the same revenue share it had in the same period of the previous year and Sun lost server market share compared to the same quarter a year ago, despite strong performance from its SPARC Enterprise systems line.
Dell was the only vendor alongside HP to enjoy an annual revenue increase after its x86 PowerEdge servers. And, rounding out the top five, Fujitsu Siemens lost around two per cent in its overall EMEA share over a year ago.
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