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IBM, HP, Dell Show Healthy Growth in Server Market

Worldwide revenues in the computer server market showed strong growth in the first quarter, as leader IBM and the other top vendors held on to their positions, a market research firm said Wednesday.

The overall market increased by 4.1 percent in the quarter to $12.3 billion from $11.8 billion in the same period a year ago, Gartner Inc. said. Growth was primarily driven by sales of x86 servers, which make up about half of the market.

Q1 growth this year, however, was less than last year, when revenues increased by 9.3 percent over 2003, Gartner said. The increase last year was primarily due to many companies replacing servers bought in 1999 and 2000. The popularity of blade servers also helped drive the market.

Nevertheless, "the numbers (in Q1 2005) are still pretty strong in comparison to where they've been," Gartner analyst Michael McLaughlin said. "This is solid, healthy growth in the server market."

In comparison, first quarter revenues in 2002 and 2003 saw a 16.9 percent drop and an increase of only 1 percent, respectively.

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