[AI] Look east for the new rulers of PC market

renuka warriar erenuka at gmail.com
Thu Jan 24 08:04:48 EST 2008

The Hindu News Update Service

News Update Service
Thursday, January 24, 2008 : 1030 Hrs

Sci. & Tech.
Look east for the new rulers of PC market


By Jack Schofield

More than half the population in Japan does email and browsing on mobile phones

The scorecards are in. The PC market grew by 14 per cent last year to roughly 270m units, or 760,000 a day. Hewlett-Packard cemented its position as the
biggest PC manufacturer by selling about 50m machines. Taiwan's Acer continued its explosive growth, overtaking China's Lenovo for third place, while Japan's
Toshiba hung on in fifth.

Those are the headline numbers from the leading PC market trackers, IDC and Garner, who both released preliminary stats last week. As usual, they are not
quite the same. For example, IDC reckons total PC shipments grew by 14.3 per cent to 269m units, while Gartner reckons they grew by 13.4 per cent to 271.2m
units. But the differences are not significant.

HP boss Mark Hurd has turned out to be a star, increasing worldwide sales by 30 per cent to 50.5m units, on IDC's numbers. In 2006, HP was level with Dell;
last year, it was ahead by 10m units. This year should be more of a fight. Michael Dell has responded by moving strongly into retail, signing deals with
the likes of Tesco. It seems to be working.

Although IDC reckons Dell's sales were down 4 per cent in the US last year, it credits the company with 15.2 per cent growth in the fourth quarter, and
17.1 per cent growth worldwide.

Meanwhile, two Asian giants are battling it out behind the two American giants. Lenovo boosted its US sales by taking over IBM's PC division, and last year,
Acer did the same by taking over Gateway. IDC commented: "Combined Acer/Gateway growth continued to be the fastest among the top vendors."

Whether this will continue is still open to doubt, but in the long term, it probably doesn't matter. The US market is in relative decline. It's becoming
more important to be strong in Asia. According to Gartner, the EMEA (Europe, Middle East, Africa) market grew by 14.7 per cent to 92m units in 2007, while
Asia Pacific grew by 18.7 per cent to 70.7m units. By contrast, the US market grew by only 5 per cent to 70.1m units, says IDC.

The decline of the US is shown by the number of companies that used to be in the top five but are now just someone else's PC brands. These include IBM,
Compaq, Gateway, Packard Bell and eMachines.

The Japanese have also failed to take over the PC world the way they swept the markets for other consumer goods. Companies such as NEC, Fujitsu, Hitachi,
Mitsubishi, Sony and Canon have not been helped by a declining PC market in Japan, where more than half the population does email and browsing on mobile
phones (tinyurl.com/2h4wee). Still, last year, Gartner reckons Japan's PC market did grow, by 5.1 per cent to 13.9m units.

Apple has also bucked the trend, and while it is relatively weak outside North America, it has climbed back into the US top five. IDC reckons Apple's unit
sales grew by 30.9 per cent last year, and it increased its US market share by one percentage point to 5.7 per cent. Apple has yet to release official
figures, and may turn out to have done even better: it certainly has in the retail market.

However, most PCs are not sold via retail stores, and it will still take Apple a while to reach Dell's current US market share of 29.6 per cent.

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