ChannelLife New Zealand - Industry insider news for technology resellers
Story image
PC outlook remains subdued despite slowing tablet demand
Wed, 4th Jun 2014
FYI, this story is more than a year old

Worldwide PC shipments are expected to fall -6.0% in 2014, a slight adjustment from the previous forecast of -6.1%, according to analyst firm IDC.

But despite such a subdued forecast, positive factors for the PC market include slowing tablet demand and steadying economic indicators that are contributing to more stable shipments in mature markets.

The Windows XP replacement activity that boosted shipments in the past several quarters is also expected to remain a positive factor for a few more quarters.

This relative improvement in the outlook will enable the United States to further its lead in PC shipments over China and keep the mantle as the biggest PC market globally through 2017.

"PC shipments are currently benefitting from a lull in tablet demand due to rising tablet penetration in mature regions and competitive pressure on smaller tablets from large-size smartphones (sometimes referred to as Phablets)," says Loren Loverde, Vice President, Worldwide PC Trackers.

"However, the transition toward mobile and cloud-based computing is unstoppable.

"PCs continue a slow transition toward touch and slim designs, even as tablet volume is expected to pass total PC volume in the fourth quarter of 2014 and on an annual basis in 2016.

"To return to growth, the PC industry is going to need to accelerate the shift to lower-cost, thin, and touch-based designs, despite the challenges it has faced with these designs in the past."

Despite the pockets of opportunity, weakening growth in emerging regions and continuing pressure from other devices – primarily smartphones and tablets – continue to push down the long-term outlook.

Consumer interest in PCs remains constrained and price-sensitive, as evidenced by overall market declines and still modest ultraslim notebook results, even as Chromebook vendors and channels expand and boost volume in this low-end segment.

The competitive environment is also evidenced in the sale of Sony's PC division, and Samsung refocusing its PC operations.

IDC expects further market restructuring and consolidation going forward as vendors review limited PC growth and look at broader mobility and computing trends.

As a result, longer-term growth was lowered slightly (by less than a percent for 2015-2017), with 2015 at -1.6% year on year with subsequent years still between 0 and -1% growth.

"2014 represents an important shift for the PC market in emerging regions," adds Jay Chou, Senior Research Analyst, Worldwide PC Trackers.

"Shipments in these parts of the world are expected to contract in double digits (nearly 20 million units fewer) compared to 2013.

"Political and economic instability in many of these markets are key factors affecting short-term intake, but a fundamental shift toward computing across the device spectrum represents a broader transition.

"IDC still expects refresh projects and continued growth in underserved areas to bring modest growth in emerging markets by 2016, but the overall volume has been further curtailed to less than 165 million units per year through the forecast horizon."