Skip to main content

Two Reasons Why the PC Market Upside is Unclear

The worldwide personal computer (PC) market saw a slight increase in volume during the first quarter of 2012 (1Q12) -- when compared to the same quarter in 2011 -- with shipments rising 2.3 percent, according to the latest market study by International Data Corporation (IDC).

The results are slightly above IDC's February projections of a 0.9 percent year-on-year decline due to anticipated hard disk drive (HDD) supply constraints in addition to weak economic conditions, competition from other devices, and continued uncertainty about Microsoft Windows 8.

HDD supply remained an issue through most of the first quarter, although PC makers generally had better access to drives than customers in the retail and distribution channels.

As a result, large PC vendors were able to maintain system shipments by managing inventory or absorbing price increases, while the impact to shipments from smaller PC makers was in line with IDC expectations.

"PC market growth was reduced in the first quarter as HDD supply and other factors limited demand," said Loren Loverde, vice president at IDC. "Nevertheless, history has shown that periods of slower growth are followed by recovery -- as improving technologies make replacements as well as new purchases increasingly compelling."

As a result, IDC expects that PC shipments will pick up significantly by the fourth quarter 2012, as HDD supply and pricing are normalized, Windows 8 is launched, and replacements are purchased.

Slow growth in the U.S. shows that despite interesting and new form factors like all-in-one (AIO) desktop PCs and Ultrabook notebook PCs, the market remains conservative and focused primarily on replacements.

Commercial buyers are still cautious, while consumers are evaluating multiple products for their needs. The U.S. PC market is likely to remain constrained at least until the launch of Windows 8, which is expected in the fourth quarter of 2012.

IDC expects vendors, retailers, and channel partners to focus their product lines and their general operations as they prepare for the year-end holiday season, because that alone will likely determine if there is any growth at all in the U.S. market in 2012.

That being said, given the recent slow adoption of new Windows OS versions (the legacy XP installed base is still significant), and the apparent minimal interest in expensive new ultrabook PCs, the full potential market upside is unclear at this time. Those are two very big reasons for continued concern.

Highlights from the regional outlook Include:

United States -- The market continued to exhibit weakness with shipments, due to saturation in the consumer market and low refresh rates in the commercial sector. Shipment growth of 1 percent over the first quarter of 2011 was in line with IDC's forecast of 0.6 percent growth. The quarter's performance reflects ongoing market changes as consumers consider media tablets instead.

EMEA -- Despite the region's sustained economic uncertainty and debt crisis, the Europe, Middle East and Africa (EMEA) PC market experienced a rebound, returning to positive growth again in 1Q12. They benefited from a more favorable year-on-year comparison versus the first quarter of 2011, when sell-in was adversely impacted by high inventory levels. IDC expected softer results in 1Q12 in light of the HDD shortages following the flooding in Thailand. However, both mature and emerging markets showed stronger than anticipated performance, driven by accelerating portable PC sales in particular.

Japan -- Buoyed by robust enterprise activity, Japan saw decent growth in the first quarter. Japanese vendors also fared better than in 4Q11 in dealing with the shortage of HDDs. Moreover, consumers continued to be receptive, and helped the market to surpass forecast.

Asia-Pacific (excluding Japan) -- This market was in line with IDC forecasts, though growth was limited. Hard drive supply issues contributed to slow shipment growth, although key countries like China and India, and vendors such as Lenovo and ASUS, continued to fare well.

Popular posts from this blog

Software-Defined Infrastructure: The Platform of Choice

As more organizations adapt to a hybrid working model for their distributed workforce, enterprise CIOs and CTOs are tasked with delivering new productivity-enabling applications, while also seeking ways to effectively reduce IT cost, complexity, and risk. Traditional IT hardware infrastructure is evolving to more software-based solutions. The worldwide software-defined infrastructure (SDI) combined software market reached $12.17 billion during 2020 -- that's an increase of 5 percent over 2019, according to the latest market study by International Data Corporation (IDC). The market grew faster than other core IT technologies. The three technology pillars within the SDI market are: software-defined compute (53 percent of market value), software-defined storage controller (36 percent), and software-defined networking (11 percent). "Software-defined infrastructure solutions have long been popular for companies looking to eliminate cost, complexity, and risk within their data cente

Digital Identity Verification Market to Reach $16.7B

As more enterprise organizations embrace the ongoing transition to digital business transformation, CIOs and CTOs are adopting new technologies that enable the secure identification of individuals within their key stakeholder communities. A "digital identity" is a unique representation of a person. It enables individuals to prove their physical identity during transactions. Moreover, a digital identity is a set of validated digital attributes and credentials for online interactions -- similar to a person's identity within the physical world. Individuals can use a 'digital ID' to be verified through an authorized digital channel. Usually issued or regulated by a national ID scheme, a digital identity serves to identify a unique person online or offline. Digital Identity Systems Market Development Complementary to more traditional forms of identification, digital identity verification systems can enhance the authenticity, security, confidentiality, and efficiency of

Conversational Commerce Advances with AI Innovations

The global eCommerce market gained new momentum as the COVID-19 pandemic transformed many legacy business sectors. As an example, conversational commerce enables end-users of smart devices to leverage them for commercial purposes -- including retail transactions and online banking. The ecosystem for conversational commerce has evolved with many communication service providers acting as the primary point of connection between the end-users of these devices and the brands, enterprises, and financial institutions that use them. According to the latest worldwide market study by Juniper Research, the global conversational commerce spend over rich communication services (RCS) messaging will reach $27 billion by 2025 -- that's rising from less than $10 million in 2021. Conversational Commerce Market Development This phenomenal growth will be driven by increasing RCS support from telecom network operators and growing interest from business leaders wishing to capitalize on this emerging eCo