Despite Economic Uncertainty PC Demand to Remain Strong

IDC reports that despite economic headwinds in both advanced economies and emerging regions, the PC market continues to show resilience. Analysis indicates that the accelerating number of consumers transitioning from desktop PCs to notebooks is having a direct impact in the industry in terms of growth projections. According to IDC’s Worldwide Quarterly PC Tracker, increased competition in the low end of the Portables market combined with recent shipment volume, suggests solid growth for the next few years.

Worldwide PC shipments for fiscal ’08 are projected to grow at a healthy pace of 15.7% reaching 311 million units. Growth projections will remain in double-digits through 2011, with growth above 9% in 2012, boosting annual shipments to over 482 million in 2012.

In terms of regional outlook: Asia/Pacific market (excluding Japan), saw lower than expected growth in 2Q’08 as rising energy costs, inflation concerns, the Sichuan earthquake as well as the summer Olympics in China cut into spending and limited growth. Year-over-year growth remained in the mid teens for Asia/Pacific market which saw volume increase by less than 14% after gains of near 20% for most of the past few years. IDC notes however, that despite a decrease on y/y basis, Asia/Pacific is still expanding quickly and the prospects for further decline in both: the short and long term seem unlikely given the still elevated economic growth in the region and the rapid pace of PC adoption.

Western Europe on the other hand continues to see very strong PC sales as growth jumped nearly 100% to 23% from just 12% in ’07. Sales are mostly driven by low-cost Portables such as the ASUS Eee PC a Linux-based OS, SSD. Western Europe Consumer Portables grew 60% over 2Q’07 and are expected to boost growth for the remainder of current year. Portable PC adoption just as in Asia/Pacific market is the primary growth component for the region’s continued growth.

Loren Loverde, director of IDC’s Worldwide Quarterly PC Tracker said:

We continue to see a rapid transition to Portable PCs around the world, even as economic pressures rise. The trend reflects the increasing importance of computing, not just in the home or office, but as an integrated part of our lives. Falling prices, more design choice and competition for PC makers to capture this market continue to drive a rapid transition.

With Portable PCs, notes IDC – becoming part of a digital lifestyle, rather than just a computing device, growth prospects in both Consumer and Commercial segments will continue to remain high.

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