Gartner Dataquest Says Latin America Server Market Suffered a Double-Digit Decline in Third Quarter of 2002.

Business Editors

SAN JOSE, Calif.--(BUSINESS WIRE)--Nov. 18, 2002

In the third quarter of 2002, server shipments in Latin America declined 12 percent, while Latin America server revenue dropped 16.1 percent from the third quarter of 2001, according to Dataquest Inc., a unit of Gartner, Inc. (NYSE: IT and ITB).

"Strong declines in the Argentinean server market, along with exchange rate instability in major economies, such as Brazil and to a lesser extent in Mexico, have definitively impacted this industry," said Lillian Alvarado, senior industry analyst covering servers for Gartner Dataquest's Computing Platforms Latin America group.

Hewlett-Packard was the leader in unit shipments with 28.2 percent of the market, while IBM was the No. 1 vendor based on revenue, as it accounted for 49.6 percent of revenue in the region (see Tables 1 and 2). HP's shipments decreased 21 percent in the quarter, but it has shown some recovery from the previous quarter, when it was affected by the Compaq merger.

Table 1

Latin America Server Vendor Unit Shipment Estimates for 3Q02 (Units)

                                3Q02                  3Q01
                               Market                Market
                    3Q02       Share      3Q01       Share     Growth
Company          Shipments      (%)    Shipments      (%)        (%)
----------------------------------------------------------------------
Hewlett-Packard    10,970       28.2     13,882       31.5      -21.0
IBM                 8,244       21.2      7,810       17.7        5.6
Dell                4,688       12.1      4,263        9.7       10.0
Itautec             2,123        5.5      1,180        2.7       79.9
Alaska              1,281        3.3      1,250        2.8        2.5
Others             11,529       29.7     15,729       35.7      -26.7
Total Market       38,835      100.0     44,114      100.0      -12.0

Source: Gartner Dataquest (November 2002)

"IBM was the top vendor in server revenue in the IA, RISC and mainframe segments of the market. However, most of IBM's revenue still comes from the mainframe segment," said Alvarado. "IBM had a strong increase in shipments in the IA 32 server market, but this segment continues to be dominated by HP through its Compaq brand. Nevertheless, HP is facing more competition in the IA 32 market by IBM, Dell and local vendors in Brazil and Mexico."

Table 2

Latin America Server Vendor Revenue Estimates for 3Q02
(Actual Dollars)

                                 3Q02                    3Q01
                                Market                  Market
                      3Q02      Share         3Q01      Share   Growth
Company             Revenue      (%)        Revenue      (%)      (%)
----------------------------------------------------------------------
IBM              206,799,457     49.6    222,954,375     44.9     -7.2
Hewlett-Packard   95,623,625     22.9    150,815,792     30.4    -36.6
Sun Microsystems  30,018,166      7.2     38,643,933      7.8    -22.3
Dell              22,287,960      5.3     21,363,806      4.3      4.3
Itautec           20,824,994      5.0     11,323,934      2.3     83.9
Others            41,437,629      9.9     51,636,365     10.4    -19.8
Total Market     416,991,831    100.0    496,738,205    100.0    -16.1

Source: Gartner Dataquest (November 2002)

Government purchases in server equipment compensated somewhat for the slowdown from the private sector. "This increase in government purchases was seen in particular in Brazil where local vendors Itautec and Procomp increased their server sales significantly because of government purchases," Alvarado said.

This information is produced by Gartner Dataquest's Computing Platforms Latin America group. The group provides research on key aspects of the dynamic PC, server and printer hardware markets in Latin America. The focus is on regional and country issues in the top eight Latin American markets and the Rest of Latin America (ROLA) category, where Central American and Caribbean countries are grouped. For more information on this program, please contact Becky Tonnesen at 408-468-8287, or by e-mail at [e-mail]. Reports can be accessed on the Internet at www.gartner.com.

Gartner Dataquest is the recognized leader in providing the high-technology and financial communities with market intelligence for the semiconductor, computer systems and peripherals, communications, document management, software, and services sectors of the global information technology industry.

Gartner, Inc. is a research and advisory firm that helps more than 10,500 clients leverage technology to achieve business success. Gartner's businesses consist of Research, Consulting, Measurement, Events and Executive Programs. Founded in 1979, Gartner is headquartered in Stamford, Connecticut, and has 4,000 associates, including more than 1,000 research analysts and consultants, in more than 75 locations worldwide. Fiscal 2002 revenue totaled $907 million. For more information, visit www.gartner.com.