Asian server sales revenue, excluding Japan, fell 20 per cent in the first half of this year compared with the same period last year due to pricing competition and IT spending cutbacks, according to a report by International Data Corp. Server unit shipments increased by 12 per cent over the past year, but income was hit by price cuts. The average selling price of servers - powerful computers that link computers in a network - dropped from US$18,300 in the first half of last year to $14,000 in the same period this year, said IDC. Vendors cut prices to attract regional businesses and governments which had suffered budget cuts. The drive for cheaper computers lifted sales of Windows NT and PC servers, particularly in Taiwan and Australia. High-end and mid-range models built on the Unix platform accounted for server growth in Hong Kong and the mainland. Australia had the biggest server revenue with 24 per cent, followed by the mainland with 22 per cent; South Korea, 16 per cent; Taiwan, 11 per cent; and Singapore, 6 per cent. 'The downturn in the regional market could have been much more severe if not for the relative strength of Australia, China and Taiwan,' said Avneesh Saxena, IDC senior analyst. The worst sales declines in the first half were seen in Southeast Asia and South Korea. Indonesia saw server revenue declines of 75 per cent over the same period last year, while Malaysia experienced a 53 per cent drop and Korea - the largest server market early last year - fell by 52 per cent. 'While conditions in Southeast Asia were particularly harsh, these markets always have represented small server markets and as a result were unable to drag regional growth down further,' Mr Saxena said. The downturn resulted in market consolidation among the top five server vendors. Their share of the market was 82 per cent, up from 75 per cent in the same period last year. The merger of Compaq Computer, Digital Equipment and Tandem Computer had a combined share of 19.7 per cent, putting it third, behind market leader IBM with 29 per cent, and Hewlett Packard with 20.4 per cent. Fourth- placed Sun Microsystems had an 11 per cent share, followed by NCR with 2 per cent.
