Hewlett-Packard (HP) is holding on to its commanding lead at the top of the server market, but competitors are gaining on it fast, according to the latest research from Gartner Dataquest.

At 38.1%, HP’s share in the third quarter of 2003 was more than double that of IBM and Dell. However, HP’s growth rate of 11.7% HP lagged well behind the overall industry pace of 21.4%.

IBM led the chasing pack with 41.2% growth in the quarter, but Dell, Fujitsu Siemens and Sun Microsystems are also closing after all three turned in shipment growth of about 30%. Moreover,

	EMEA server vendor market share Q303 Source: Gartner

HP was the only major company not to make gains in its market share over the same quarter last year.

In contrast to the runaway growth in units shipped, revenues for the sector only grew 4% over the same quarter in 2002, to reach $3.6 billion. The disparity stems from continued price erosion in the sector.

Karen Benson, Research VP at Gartner, says that the results showed a “gradual return to a positive spending climate.” And she adds: “The third quarter was an extraordinarily robust quarter in terms of server shipments, without the seasonal slowdown we are used to in quarter three.

“The positive result was mainly driven by strong demand in the UK, Germany, France and the Middle East and Africa.”