However, Taiwan x86 server shipments for the quarter were up 2.8 percent year-to-year, according to IDC.

IDC Taiwan analyst Yeh Yu-lin said that the quarterly drop may be the result of rising oil prices and Taiwan's presidential election in March.

The first quarter of the year is also traditionally slower for business, he added.

Shipments of x86 blade servers in Taiwan for the January-March period dropped a whopping 29.9 percent over the previous quarter, but marked an increase over the first quarter of last year.

According to IDC, blade servers will act as the driving force behind growth in Taiwan's overall server market in 2008, with the government's promotion of energy conservation expected to give a boost to green products.

Two of the world's top five server manufacturers are Taiwanese companies, namely ASUS and Acer, which along with IBM, HP, and Dell control 94.7 percent of the global server market in terms of value.