Despite market optimism early in the fourth quarter, the pace at which the economic environment unraveled, and the extent to which Personal Computer (PC) purchases were affected, was faster than anticipated.
Following roughly six years of growth, with the last five averaging 15 percent increases, worldwide PC shipments were down 0.4 percent year on year in the fourth quarter of 2008 (4Q08), according to IDC's latest global study.
The dramatic slowdown was enough for a sequential decline of 2.5 percent from the third quarter in place of an expected increase for the holiday season.
The weakening economic environment, including falling home and stock values, deteriorating credit, and implications for trade and consumer spending, was clearly the dominant factor limiting growth.
Low-cost portables, vendor competition, and holiday promotions were simply not enough to overcome the economic tide, even with the market for mini notebooks (also known as netbooks) taking off.
Growth of portable PCs was cut roughly in half from nearly 40 percent year on year in the first three quarters of 2008 to roughly 20 percent in the fourth quarter. Meanwhile, the pressure on desktop PCs pushed volume down roughly 16 percent from a year ago after only a small decline earlier in the year.
Mini notebook volume is estimated at near 5 million units in the fourth quarter, bringing the total for 2008 to about 10 million, accounting for nearly 7 percent of total portables, with shipments expected to double in 2009.
Despite the dramatic slowdown in fourth quarter shipments, annual volume was up 10.5 percent in 2008. This was on par with 2006, when some vendors struggled with the accelerating transition to portables and replacement rates dropped with economic uncertainty and the pending launch of Vista.
"For all that's been said about this recession being different than 2001, the drop in PC growth from mid-teens the preceding year to near flat growth in the most recent quarter shows that the impact of this crisis looks similar to the last time around," said Loren Loverde, program director for IDC's Worldwide Quarterly PC Tracker.
It is tempting to argue that international markets will be less affected, or that low prices and the transition to portables will limit the impact, but the market has taken a serious hit and the competitive environment along with a race to low-cost portables could easily undermine profits from mobile computing.
Following roughly six years of growth, with the last five averaging 15 percent increases, worldwide PC shipments were down 0.4 percent year on year in the fourth quarter of 2008 (4Q08), according to IDC's latest global study.
The dramatic slowdown was enough for a sequential decline of 2.5 percent from the third quarter in place of an expected increase for the holiday season.
The weakening economic environment, including falling home and stock values, deteriorating credit, and implications for trade and consumer spending, was clearly the dominant factor limiting growth.
Low-cost portables, vendor competition, and holiday promotions were simply not enough to overcome the economic tide, even with the market for mini notebooks (also known as netbooks) taking off.
Growth of portable PCs was cut roughly in half from nearly 40 percent year on year in the first three quarters of 2008 to roughly 20 percent in the fourth quarter. Meanwhile, the pressure on desktop PCs pushed volume down roughly 16 percent from a year ago after only a small decline earlier in the year.
Mini notebook volume is estimated at near 5 million units in the fourth quarter, bringing the total for 2008 to about 10 million, accounting for nearly 7 percent of total portables, with shipments expected to double in 2009.
Despite the dramatic slowdown in fourth quarter shipments, annual volume was up 10.5 percent in 2008. This was on par with 2006, when some vendors struggled with the accelerating transition to portables and replacement rates dropped with economic uncertainty and the pending launch of Vista.
"For all that's been said about this recession being different than 2001, the drop in PC growth from mid-teens the preceding year to near flat growth in the most recent quarter shows that the impact of this crisis looks similar to the last time around," said Loren Loverde, program director for IDC's Worldwide Quarterly PC Tracker.
It is tempting to argue that international markets will be less affected, or that low prices and the transition to portables will limit the impact, but the market has taken a serious hit and the competitive environment along with a race to low-cost portables could easily undermine profits from mobile computing.