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MEA x86 server market shows strong Q3 growth

Quarterly Tracker figures from IDC reveal healthy segment, with 9.9% volume surge

The MEA x86 server market expanded 9.9% in volume during Q3 2013, with revenue rising 10.6% over the same period, according to IDC.
The MEA x86 server market expanded 9.9% in volume during Q3 2013, with revenue rising 10.6% over the same period, according to IDC.

The Middle East and Africa (MEA) x86 server market played saw significant year-on-year growth in the third quarter of 2013, according to the latest data from International Data Corporation (IDC).

Referencing its latest EMEA Quarterly Server Tracker, the research and advisory firm today announced that the MEA x86 server market expanded 9.9% in volume during Q3 2013, with revenue rising 10.6% over the same period.

The Saudi market was the standout performer of the quarter in the GCC, registering strong year-on-year volume growth of 16.4%.

"Several major deals were completed with various government ministries, banks, and education institutes during the quarter, combining to drive the strong growth seen in Q3," said Zeeshan Gaya, research manager for servers and systems at IDC Middle East, Africa, and Turkey.

"The UAE market also exhibited strong year-on-year growth, with shipments increasing 13% on the back of key projects taking place in the government and banking sectors."

In contrast the so-called Other GCC (OGCC) bloc of countries (Bahrain, Kuwait, Oman, and Qatar) suffered a marginal 1.8% decline in volume over the same period, although there was a significant year-on-year increase of 22.6% in revenue. The growth in revenue came as a direct consequence of the average selling price of a server increasing 24.8% compared to Q3 2012.

As expected, the Egyptian market slumped 36.6%, year on year, in volume terms as a result of severe project delays and cancellations brought about by the ongoing political instability in the country and associated uncertainty. Indeed, the only noticeable projects seen in Egypt during Q3 2013 were for the Egyptian Stock Exchange and within the defence sector.

Turkey also experienced a downward trend in the third quarter of the year, with unit shipments dipping 8.8%, year on year. The government, banking, and telecommunications sectors were the key IT spenders in the country during this period.


"The Turkish government is proactively taking necessary measures to increase the economic and political resilience of the country," said Adriana Rangel, research director for systems and infrastructure solutions at IDC Middle East, Africa, and Turkey.

"It is also striving to improve the investment environment in an attempt to facilitate and stimulate continuous economic growth. Additionally, local elections scheduled for mid-2014 are expected to have a positive impact on IT spending in the country."

Strong year-on-year shipment growths of 35.7% and 21.8% were recorded in Morocco and Tunisia, respectively, stimulated by the stable nature of the political situation in these countries and corresponding investments in the government, banking, and telecommunications sectors. Overall, the North Africa region performed well in Q3 2013, registering a 20.4% increase in volume when compared to the corresponding quarter in 2012.

The Kenyan and Nigerian markets secured the highest growth seen across the entire MEA region in Q3 2013, registering an annual shipment growth of 67.1% and 62.8%, respectively.

"Sizeable projects conducted by financial institutions and telecom operators contributed to the strong server growth seen in Nigeria, while the majority of large deals conducted in Kenya during the third quarter of the year were in the banking and utilities sectors, with the government sector taking a back seat," said Gaya.

South Africa experienced a 6.6% year-on-year increase in server shipments, driven primarily by investments in the government and financial services sectors.


"Server uptake in the small and medium-sized business (SMB) space was sluggish in South Africa during Q3 2013, with the majority of spending coming from the enterprise segment," continued Gaya.

"The purchasing pattern among mid-to-large organisations has been gradually shifting from standalone servers to converged and integrated solutions. However, some large government deals are in the pipeline for Q4, with a particular emphasis on e-government initiatives such as smart energy management solutions and smart city programmes."

Growth was seen across all the major form factors in the MEA region during Q3 2013. Blades were the market's strongest performers, with shipments up 27.5%, year on year, followed by rack-optimised and tower servers, with increases of 8.7% and 3.2%, respectively. Bucking the trend somewhat, shipments of density-optimised servers were down 22.9%, year on year, across the MEA region.

Shipments of one-socket servers grew an impressive 24.8% over Q3 2012, securing market share of 30.4%, up 3.6 percentage points from last year. Two-socket servers remain the dominant socket capability, however, accounting for more than half of the MEA market with 65.1% unit share. Four- and eight-socket servers continued to grow in the third quarter of the year, recording year-on-year volume increases of 24.3% and 47.4%, respectively.

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