According to IDC's EMEA Quarterly Server Tracker, the server market experienced its highest dollar revenue levels since IDC started tracking consolidated server sales in EMEA in 1Q00. Boosted by a weakening of the dollar/euro exchange rate, server factory revenue grew by 3.6% in annual comparison, to $5.46 billion, while shipments rose 7.3%, to more than 750,000, in 4Q07 over 4Q06 in EMEA. This marks the sixth consecutive quarter of positive annual growth when measuring factory revenue performance in dollars, and comes on the back of a strong year. For the whole of 2007, market growth was robust, with factory revenue rising 5.6% annually, to reach $17.86 billion, and shipments growing 8.9% to over 2.6 million.
Virtualization, along with systems management and automation, is driving IT investment in midsized companies as well as large enterprises. "The diversity of workloads running on customer sites is driving demand in all top 3 operating systems, with Windows significantly increasing its market share to 35.7% of the total revenue in 4Q07, three percentage points ahead of Unix. The full impact of Windows Server 2008 will only become apparent by the end of this year, and the battle for the virtualization market, with new management tools by the leading vendors, will spur competition in this area," said Nathaniel Martinez, director, European Enterprise Servers at IDC and lead analyst for IDC's virtualization practice in EMEA.
Multicore, virtualization, and blades are all contributing to the strong uptake of volume servers, which are gaining favor with SMB and enterprise customers alike, a market trend translated into a factory revenue share of 49.6% of the total in EMEA in 4Q07 and a growth of 6.5% annually. "Both revenue and unit growth were driven by an increasing demand for more highly configured x86 servers, used for virtualization and consolidation projects in a wider range of industries and customer segments," said Beatriz Valle, research analyst of European Enterprise Servers at IDC. "Sales of non-x86 servers experienced a slight recovery quarter on quarter, due to favorable seasonal factors and corporate renewal projects, but dropped 2.4% annually. x86 servers meanwhile increased their presence in the high-end server space."
With revenue growth driven mainly by emerging markets and more specifically CEE, Stefania Lorenz, IDC systems research director for the CEMA region, said, "2007 proved to be another banner year in the CEMA region with factory revenue growing 18.3% and shipments 15.8%. Although the year did not end with a bang, it did end on a high note. 4Q07 saw factory revenue climb 17.3% year on year, with shipment volume increasing 14.3%, generated by strong demand for both x86 and non-x86 platforms, and with midrange servers driving spending as firms continued to renew their IT infrastructure. Blades continue to gain market share in both CEE and MEA at the expense of non-rack optimized servers."
IDC's Quarterly Server Tracker is a quantitative tool for analyzing the server market on a quarterly basis. The tracker includes quarterly shipments (both ISS and upgrades) and revenues (both customer and factory), segmented by vendor, family, model, region, country, operating system, price band, CPU type, and architecture.