China's businesses, government departments and other organisations spent more than $592m on servers in the three months to June 2007, according to analyst estimates.

Foreign firms dominated the market, with three major US vendors taking more than 70 per cent of all sales revenues.

A total of 156,000 servers were sold in China during the second quarter, according to research firm Analysys International.

The figure represents an increase of almost 28 per cent over the first quarter, and is 10.8 per cent higher than the same period one year ago.

While server shipments are rising rapidly total revenue is failing to keep pace, indicating that the average price paid per server in China has fallen considerably over the past year.

The second-quarter sales total of $592m was an increase of only five per cent on the first quarter, and sales revenues for the quarter were actually down 5.3 per cent from a total of more than $625m in the second quarter of 2006.

Dell, IBM and HP took almost equal shares of the market in terms of unit shipments, each responsible for approximately 22 per cent of sales.

However, the three companies appear to be selling into distinctly different price ranges. IBM took a 35.5 per cent share of the money paid for servers, compared to 25.1 per cent for HP and only 10.4 per cent for Dell.

Servers based on the standard Intel-compatible x86 CPU architecture constituted the lion's share of the market, but sales of other hardware platforms rose slightly in the past year.

Non-x86 sales increased from four per cent of the total a year ago to slightly more than seven per cent in the second quarter of 2007.