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This article comes from IDC

Desktop Virtualization Will Drive the Next Wave of Thin Client Growth in Asia/Pacific (excluding Japan), with a 36.3% Year-on-Year Unit Growth Expected in 2008, Predicts IDC

According to a recent tracker study on the Asia/Pacific excluding Japan (APEJ) thin client market, total sales of thin clients in 1H 2007 reached 282,667 units, representing an increase of 37.3% over the previous year. Revenue likewise increased 29.2% over the same period. With PC replacement cycles across APEJ expected to ramp up again in 2009 and 2010, a portion of IT managers will start looking at alternative means from the regular desktop environment, in order to lower total cost of ownership (TCO) and improve hardware manageability. With ever-increasing hardware sprawl, the more aware IT managers are open to deploying thin clients for users that may not require full notebook functionality all the time.

The APEJ thin client market is expected to grow strongly over the next five years, with a compound annual growth rate (CAGR) of 21.4%. This growth will be driven primarily by India and the PRC, with good support from Singapore, Indonesia and Thailand. Encouraged by the increase in operational efficiency that organizations have reaped from server virtualization, companies are now open to the idea of desktop virtualization, and thin clients can play an ideal complementary role as the access terminal across various verticals. The government/education, healthcare, and financial services segments especially, which traditionally have been strong proponents of thin clients, will continue to see expansion over the forecast period.

“With the push towards virtual desktop environments, and application delivery software vendors such as Citrix focusing on this segment within the Asia/Pacific region, thin client uptake is slated to grow even faster,” said Reuben Tan, Senior Manager of Asia/Pacific Personal Systems Research at IDC. “Advancements in virtualization software that enables a non-degraded user experience when running even resource hungry applications remotely, has opened the door to adoption of virtualized environments and thin clients across new markets, and in entirely new industries.”

APEJ Thin Client Market Dynamics

• Across the various verticals, the predominant role of thin clients across the region has shifted away from government/education segment to financial services as the leading vertical of thin client adoption from 1H 2006 onwards.
• The key markets of Australia, India and the PRC captured 86.4% of all thin client shipments across APEJ in 1H 2007, indicating that the distribution disparity between markets with larger populations and smaller but matured economies leans towards the former.
• However countries with a smaller installed base will not necessarily post stronger growths in the coming years; of all individual countries, the PRC and India are showing two of the highest CAGRs through 2012, expanding 22.1% and 20.6% respectively.