Vars optimistic despite Q1 slump

Channel players upbeat about the second half of the year

Despite research claiming that the European storage and switch market continues to decelerate, channel players are more upbeat about the second half of the year.

According to the latest Channel Tracker survey from Global Touch, covering sales of enterprise storage and switch products for the first quarter 2003, 66 per cent of European resellers said sales were the same as or less than those of Q1 2002.

The report also warned resellers to expect new competition from networking equipment vendors and Dell.

Nine out of 10 European resellers said sales were down, although UK resellers were reporting slightly stronger sales, which the survey put down to an "end of fiscal year budget flush".

Denise Sangster, chief executive of Global Touch, said: "Quarterly sales started off fairly strong but lost steam through the quarter with disappointing sales in March."

She added that 55 per cent of respondents predicted lower revenues for the first half of 2003 but strong sales in the second half of the year.

Graeme Rowe, marketing manager at Var Positiv, said his company has had a good quarter but that customers are delaying purchases until the situation in Iraq has become clearer.

"As a company we are doing pretty well, but we definitely noticed that events in other parts of the world are making people think more," he said. "But it's the market to be in. It's going to be good for the rest of the year."

Hitachi, Maxtor, Network Appliance and Snap Appliance sales were all in line with expectations or ahead for the quarter, according to European resellers.

But sales were below expectations for Brocade and EMC, according to 52 per cent and 58 per cent respectively of respondents.

Two-thirds said Hewlett Packard sales were "below" to "extremely below" expectations, while 57 per cent of respondents said sales of Sun were "extremely below" expectations