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HP squeaks past IBM into number one server seller spot

Just in Europe, Middle East, and Africa – but still...

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European server sales and shipments may have been muted when compared than in the world at large in the fourth quarter, but business was healthily up: revenue grew by 9.1 per cent to $4.3bn, the highest seen in EMEA since Q1 2007, according to IDC – and HP slipped into the number-one server-seller spot, besting worldwide leader IBM by a mere $10m.

In the final quarter of 2010, according to a recent report by IDC, server shipments across all of Europe, the Middle East, and Africa, rose by 3.4 per cent to almost 650,000 units. During all of 2010, EMEA companies consumed 2.3 million units, or 30.3 per cent of the world's total, and spent $13.8bn on those boxes, which was 28.7 per cent of the global money pie.

Big banks and insurance companies, which have been waiting for the recovery so they could invest in new mainframes, did so with vigor in the fourth quarter, pushing IBM System z revenues up 62.6 per cent to just over $600m, according to IDC. That growth was a little less than the world at large, but only by a handful of points.

Beatriz Valle, senior research analyst in the enterprise server group in IDC's EMEA unit, said that the IBM mainframe recovery was driven by strong acceptance of the System zEnterprise 196 machines announced last July. Most of the System z sales were concentrated in Western Europe, with the exception of the UK, which was not so keen to spend on the new machines.

Even while the mainframe was on the rise, RISC and Itanium platforms did not do well at all. IDC says that x64-based machines had a 15.4 per cent revenue rise in Q4 to just over $2.7bn, and non-x64 iron (CISC mainframe, RISC, and Itanium machines) accounted for $1.65bn in revenues, up only one measly point. If you extract IBM mainframes from that number, Itanium machines stomached a 15.8 per cent decline, and RISC boxes took a 19.3 per cent hit, as well.

Oracle, which got into the server racket by virtue of its acquisition of Sun Microsystems last year, was a significant drag on all the figures in Q4. IDC says that Oracle's x64-based server business, which is more or less restricted to upgrades for existing customers and clusters to run parallel databases from Oracle, actually grew 2.2 per cent in revenues. IDC didn't give out a number, but if you do the math based on what IDC did say, you can calculate that it was just over $97m in sales. With Oracle's overall server sales down 38.3 per cent, to $239m, that means that Sparc-based server sales in EMEA did a 51.5 per cent power dive (I guess that should be "a spark dive") to $142m.

By platform, IDC says that EMEA shops consumed $1.95bn in Windows boxes, $935.4m in Unix boxes, $756.2m in Linux boxes, and $725.6m in "other" machines, including over $600m in System z mainframes.

In terms of growth, the hot spots are Central and Eastern Europe, the Middle East, and Africa. System revenues in Central and Eastern Europe hit $588.7m, up 17.3 per cent, while the Middle East and Africa, propped up by Saudi Arabia and Turkey, accounted for $432.5m, up 8.7 per cent. Western Europe, as a whole, didn't do so badly, with sales up 7.8 per cent, to $3.35bn.

HP might have been the number-two vendor worldwide in IDC's Q4 rankings, but in the EMEA region the company snuck past IBM, despite Big Blue's resurgent mainframe biz, to capture $1.57bn in sales compared to IBM's $1.56bn. HP's revenue growth was less than half of IBM's in the quarter, but given its dominance of the x64 server racket, HP's revenues and growth going forward is arguably more sustainable.

Dell, with $426m in sales, up 26.2 per cent from the year-ago period, was the number-three server maker in EMEA, as it is globally. Oracle, which was number-three in EMEA last year, fell to fourth place with its $239m in revenues, and Fujitsu came in fifth, with $208m in revenues for the quarter, up 2.7 per cent. Other vendors accounted for $363m in sales and rose 5.6 per cent, year-on-year. ®

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