ASIA-PACIFIC server shipments fell for the first time in nearly seven years in the fourth quarter of 2008 as the global economic slump hit spending on technology products, a report said on Tuesday.

Shipments in the three months to December dropped 5.8 per cent year-on-year to 349,135 units and revenues tumbled 14.8 per cent to US$1.91 billion (S$2.94 billion), market intelligence firm Gartner said.

It was the first decline for the region?s server market following 27 quarters of consecutive growth, the firm said.

'The decline in IT (information technology) spending that first showed itself during the third quarter gathered steam in the fourth quarter in Asia Pacific under the impact of (the) global economic recession,' said Gartner analyst Erica Gadjuli.

Heeral Kota, a senior research analyst at Gartner, described the outlook for this year as 'challenging' with the weak economic conditions seen to further limit expenditures. -- AFP