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Portables PC Growth Displacing Desktops

Worldwide PC shipments are projected to rise by 16.7 percent in the fourth quarter of 2007, according to the latest IDC market assessment.

Following a slow second half of 2006, with growth reaching a low of 7.9 percent in the fourth quarter, growth has accelerated steadily in 2007, reaching 16 percent in the third quarter. As a result, annual growth is expected to reach 14.6 percent in 2007, up from 10.1 percent in 2006.

Portable PC adoption remains a key driver. In the third quarter, Worldwide Portable PC shipment growth of 37 percent was the fastest in more than a decade, edging growth of more than 35 percent in several quarters in 2003 and 2005.

The rapid move to Portables has taken a toll on Desktops. With the support of emerging regions, global Desktop volumes continue to increase in low single-digits. However, the growth differential between Desktops and Portables has never been larger.

In the third quarter, Portable growth was more than 33 percentage points faster than Desktop growth -- a differential that has not been over 30 percent since 1996. The rapid transition has boosted Portable share of Client PCs to nearly 45 percent in the third quarter, and will likely reach 50 percent by the end of 2008.

"The peak Portable growth seen in the third quarter will be difficult to sustain, but it reflects strong demand across regions and segments that will fuel growth going forward," said Loren Loverde, director of IDC's Worldwide Quarterly PC Tracker. "It will be increasingly important for PC vendors to have a strong Portable offering to stay competitive as the market continues its rapid shift to mobile computing"

International markets have also driven volume. Following years of steady growth, the PC market outside the U.S. and Japan reached 68 percent of global shipments in the third quarter. Asia-Pacific (excluding Japan) and Rest of World (including Latin America, Canada, Central and Eastern Europe, Middle East and Africa) are approaching 50 percent share and growing by more than 20 percent in 2007. Western Europe, representing more than 22 percent of global volume, also continues to grow at a rapid pace.

"The significant influences driving the growth of portable PC volume include: falling prices, the narrowing performance gap as compared with desktops, improving wireless connectivity, and the expanded access through retail channels," said Richard Shim, personal computing research manager. "The desktop market will aim to maintain share by emphasizing improvements in energy efficiency, shrinking case designs and emerging mainstream opportunities, such as gaming and all in one systems."

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