It is expected that demand for value-line servers will remain strong in Asia and other emerging markets in the second half of 2006. Furthermore, year-end corporate spending in the United States and Europe is not expected to decline, and growth is therefore expected in the server market in the second half of the year. However, close attention should still be paid to possible adverse effects of the expected slowdown in economic growth and further increases of oil prices on consumer and corporate spending.
On the supply side, price competition and new CPU models are expected to be major growth drivers for global server shipment in the second half. However, as scale of price cuts is lower than previous years and performance improvement of new models is insufficient to stimulate large-scale replacement demand among enterprises, growth of the global server market in 2006 will lag behind that in 2005.
Shipment volume in the second half of 2006 is expected to hit 4.1 million units, up 8.09% year-on-year and 7.4% in comparison with the first half of the year. Shipment volume for the full-year 2006 is expected to grow only 10.2%.
Figure 3
Worldwide Server Market Size, 1Q 2004 - 4Q 2006
Source: MIC, September 2006
Figure 4
Worldwide Server Market Size, 2001 - 2010