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Latin America Server Market Takes a Dip

By Gretchen Hyman (Send Email)
Posted May 30, 2002


Research and advisory firm Dataquest Inc., a unit of Gartner, Inc. , released findings Thursday that indicate a significant decline in the Latin American server market.

The study was conducted by Gartner Dataquest's Computing Platforms Latin America Group, which provides research on the PC, server, and printer hardware markets in Latin America. Gartner Dataquest research points to a 10 percent decline in Latin America server shipments and revenue.

Due in part to the turbulent economic climate in Argentina in recent months, during the first quarter of 2002, server shipments took a 10.4 percent dip, with a 16.1 dip in overall Latin America server-generated revenue, according to Dataquest.

Argentina alone posted an 85 percent decline in server shipments during the first quarter, a significant fall from grace from its perch as Latin America's third largest server shipment source. For the first quarter of 2002, Argentina ranked number eight in Dataquest's research.

Brazil, Mexico, and Chile also posted low server shipments stats, with Colombia taking the lead at a 19 percent increase in shipment growth, which Dataquest attributes to pre-election IT investments in the government sector.

Manufacturers that led the market included IBM , which according to Dataquest held strong as the leader in vendor revenue, claiming 34.6 percent of Latin American market share. Although Big Blue also reported negative growth of 15.4 percent, which IBM says was the result of lower shipments of RISC servers and mainframes.

Compaq continued its lead in unit shipments, claiming 22.4 percent of the market. But with the exception of Dell Computer and Alaska, Dataquest says all top-tier server vendors suffered a decline in shipments.

"Compaq experienced a decline in shipments, but an increase in revenue because of a different mix and higher average prices in its Intel servers," said Lillian Alvarado, senior industry analyst for Gartner Dataquest's Computing Platforms Latin America Group. "The company has had success in penetrating the higher end segment of this market in the region."

Local Brazilian firm Itautec shipped more 4-way and 8-way servers compared to the first quarter of 2001, suggesting that Itautec is slowly penetrating the midrange ends of the server market.

"In the Intel-based server segment, with a price of up to $25,000, Itautec is slowly penetrating the midrange and-higher-ends of this category," said Luis Anavitarte, vice president and research director for Gartner Dataquest's Latin America group. "These statistics are suggesting that market confidence in local server manufacturers is on the rise."

In a similar slump, Latin American printer shipments also took a nosedive during the first quarter, ringing in at only 1.3 million units and marking a 14 percent decline from a year ago, according to a separate study by Dataquest.

Inkjet printer shipments continued to show signs of a slowdown, whereas the page printer market showed incremental signs of positive growth.

The steepest decline was seen in Brazil, Latin America's leader in printer shipments, with a whopping 15.9 percent drop in the first quarter of 2002. Printer shipments fared worse for Argentina with a 93.4 decline.

The top five vendors however, Epson, Lexmark , Canon , Compaq, and Hewlett-Packard all maintained their positions in the market. HP saw a 2 percent decline in shipments and Compaq reported positive growth during the quarter.

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