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Demand for Personal Computers to Slow

As the economic crisis continues to evolve, demand for personal computers is expected to slow quickly. IDC expects worldwide PC shipments to grow just 3.8 percent in 2009 with shipment value falling by 5.3 percent.

This is considerably slower than second quarter projections of 13.7 percent growth in units and 4.5 percent in shipment value. The outlook for full year 2008 and 2010 have each been lowered a couple percent to 12.4 percent and 10.9 percent, respectively, with growth above 12 percent for 2011 and 2012.

Emerging markets in Latin America, Central Europe, the Middle East and Africa are among the most significantly affected in the short term. Falling commodity prices, a rising dollar, and restricted credit have had a dramatic affect on consumer and distribution channel financing.

These regions had been among the fastest growing markets over the past several years as falling prices helped new users acquire systems. Now Latin America and Central/Eastern Europe are expecting volume to fall through the third quarter of 2009.

Volume will continue to expand in the Middle East and Africa, but at a slower pace than in recent years.

More mature regions are also expecting slower growth. Although the credit crunch will have a significant impact on spending in these regions too, a larger portion of the market will be able to weather the storm.

Volume growth in these regions has been lowered by 4 to 9 percent for 2009. Shipments in the United States are expected to decline by almost 3 percent in 2009 with low single-digit increases in subsequent years.

Japan and Canada will see low single-digit growth for a couple years as well. Western Europe has been slower to feel the credit crunch, and low cost notebooks remain a huge driver, so growth is expected to continue at 6 percent, although this is well below growth of more than 20 percent in 2008.

Asia/Pacific excluding Japan (APeJ) is also affected, although growth is not slowing as fast as in other emerging regions, and total growth remains above the mature regions. Shipments in APeJ are expected to increase by 7 percenet in 2009 and by 18-20 percent in subsequent years, making APeJ as the fastest growing region throughout the forecast.

"Declining shipment growth in the consumer market along with the relatively stagnant commercial market will lead to fewer opportunities and more intense competition in the U.S. PC market," said Richard Shim, Personal Computing research manager. "Consolidation is expected as PC makers tough out the competitive climate amid lower than expected volumes and thinner margins."

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