Server sales sink deeper

Worldwide server revenues declined for the sixth quarter in a row to US$10.5 billion in the second quarter, down 17 percent from $12.6 billion in the same period last year, according to IDC in Framingham, Mass.

Weak sales in Japan and Europe added to revenue declines of 11 percent in the U.S. and 7 percent in the Asia-Pacific region, excluding Japan, IDC said, although it added that those decreases were smaller than expected.

Despite the softness in the second quarter, year-over-year sales for the remainder of 2002 should be near flat, the market research firm said.

The second quarter also marked the first time that IBM Corp.'s position as worldwide server market leader was challenged by another vendor. Hewlett-Packard Co., in its first quarter after merging with Compaq Computer Corp., drew even with IBM in overall server revenue, with each company garnering a 28.7 percent market share, IDC said.

But HP lost market share overall, when current revenue is compared with the combined revenue of HP and Compaq last year for the same period, IDC said. It added that on a sequential basis, HP rivals IBM, Sun Microsystems Inc. and Dell Computer Corp. all saw an increase in revenue from the first quarter of this year to the second, even though the overall server market declined 3 percent from quarter to quarter.

Gartner Inc.'s Dataquest unit in San Jose also reported a double-digit decline in second-quarter server revenue. It announced that sales dropped 13 percent year-over-year, from $11.6 billion to $10.1 billion.

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