International Business Machines (IBM) has opened the mainland's first dedicated plant for rebuilding and refurbishing old server computers, placing the 100-year-old technology giant at the forefront of a niche domestic market worth about US$18 billion by 2014.
The United States-based firm yesterday said the new Shenzhen 're-manufacturing centre', its ninth such facility worldwide, would help reduce the environmental impact of 'e-waste' - discarded electrical and electronic devices - by extending the life of older information technology equipment that would otherwise go into landfills.
Richard Dicks, the general manager at IBM's Global Asset Recovery Services unit, said the firm was 'the first IT provider licensed by the government to re-manufacture servers on mainland China'.
The Shenzhen facility will initially handle hundreds of IBM's Power Systems-brand servers that the firm plans to buy this year from mainland corporate customers, as they upgrade to new IBM equipment.
Each server will be reconditioned, tested and certified by IBM or rebuilt to meet specific customer needs.
Labelled 'IBM Certified Pre-owned Equipment', these low-cost servers will be sold mostly to small and mid-sized businesses.
IBM said the Shenzhen re-manufacturing centre 'will rapidly expand' to annually process about 100,000 low-end and mid-range IBM servers, personal computers, and servers from other computer brands by 2014.
'The demand for IT products in emerging markets is growing. However, not all businesses want to purchase new products,' Dicks said.
Technology research firm IDC said the mainland market for used information-technology equipment would reach US$25 billion by 2014.
Used servers and personal computers will make up more than two-thirds, or US$18.3 billion, of that forecast.
Preliminary estimates by market research firm Gartner show that IBM led China, the world's second-largest information technology market after the United States, in total server sales last year.
IBM's mainland revenue climbed 27 per cent to US$2.51 billion last year, from US$1.97 billion in 2010 - seizing a 44 per cent domestic market share. Gartner said IBM was also the world's No1 server supplier in terms of revenue last year.