UK server market back on its feet


UK server market back on its feet

Microscope contributor


The UK server market has picked itself off the canvas following a series of heavy blows delivered by the recession.


Both shipments and revenues rebounded in the third quarter, albeit on a sequential basis, with units up 24% to 81,000 servers and factory revenues climbing 32% to $536m. On a yearly comparison, sales fell 12.7% and their value dropped 13%.


“This is the first time since the beginning of the downturn that the UK has recorded sequential growth,” said IDC programme director for European server research Nathaniel Martinez.


To be precise that equates to five consecutive quarters of negative shipment growth and four in terms of revenues, but it was the large enterprises that have frozen budgets for much of the year that underpinned the return to growth.


“There is more predictability in the market, companies have started spending again but more carefully, they postponed server refreshes for so long that it has become more expensive not to refresh,” said Martinez.


The cut in VAT for 2009 that was derided after its announcement was also helping convince some customers to put their hands in their pocket before the 2.5% is reintroduced from January he added.


Unit sales across all form factors grew on last quarter; racks grew 23.5%, tower increased 25.8% and blades rose 27%.


Credit remained difficult to come by for SMEs and slow momentum in this space would likely spill into 2010 said Martinez. He also anticipated a marked slow down in public sector spending next year that will drag down the overall market.


As for the vendors, market leader HP grew unit sales 61% on last quarter, IBM went up 53.8% and Dell achieved more modest growth of 4.3%. Sun and Fujitsu, in fourth and fifth, saw sales fall sequentially 20.9% and 7.7% respectively.


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