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SA catching up in PC sales


Johannesburg, 19 Sep 2006

SA could soon make it onto the "top 10" list of countries buying the most PCs.

David Drummond, Acer`s SA country manager and head of mobile products for the Middle East and Africa region, says the country is fast closing the gap in terms of units sold.

"I won`t be at all surprised if SA was one of the top 10 countries by the end of next year."

In SA, the first half of the year saw the market grow 60% year-on-year, he says. Quarter three is shaping up for between 45% and 50%, Drummond says.

SA makes up about 3% or 4% of Acer sales in the Europe, Middle East and Africa (EMEA) region.

Looking at PC sales overall by countries, out of the top 10, the 10th position is a country that sells 1.4 million units a year. SA sells 1.2 million units a year.

"SA is growing very fast; it`s closing the gap on traditional developed markets."

Global growth

The company says the second half of the year is an improvement on the first. In its second quarter figures, released globally on Saturday, Acer reported a 35.7% growth in the global PC market. The company is now fourth in the global PC market.

The global market grew at 9.7% during the quarter, which Acer says was "especially due to the excellent performance posted in emerging markets and the increase in consumer demand".

"It is continually clearer that the highest growth is posted in emerging markets where economies are more positively dynamic," comments Acer president Gianfranco Lanci.

In the EMEA region, Acer posted 22% growth over the same period in 2005, which meant it had market share of 19.2% in the second quarter of this year.

So far, the third quarter has been good, says Drummond, and the fourth shows signs of being "phenomenal". This is partly due to the Christmas season, he adds.

While Western Europe is a mature market, SA is not and has been showing growth recently. Drummond explains that the local market is characterised by first-time buyers and, as a result, has not been impacted by the non-arrival of Window`s latest operating system, Vista.

Consumers are concerned, however, by Vista upgrade offers. Specifically, should customers buy a PC during the window period around the launch - the date of which is yet to be announced - they want to know who will pay for the upgrade, and how this will be effected.

Countries such as China - number two in the global PC index - Russia and Turkey are driving computing demand, he says. These markets are "developing rapidly, especially China".

Slowdown ahead?

However, despite Drummond`s optimistic outlook, Gartner has warned that while sales will go up, revenue will go down.

In a statement released on Monday, the international research company said that global PC shipments are on track to reach 233.7 million units in 2006, a 10.5% increase from 2005. Worldwide PC revenue, however, is expected to reach $198.3 billion, a 2.5% decline, according to a preliminary forecast by Gartner.

Steeper price declines will also drive faster growth in emerging markets, said Mikako Kitagawa, principal analyst for Gartner Dataquest`s Client Platforms research programme.

"Growth should be more sustainable in these markets due to low penetration, expanding economies, and a growing number of PC ownership initiatives. Emerging markets are expected to post solid double-digit growth during the next two years," the company stated.

Despite this, PCs are expected to have a difficult time competing for consumer wallet share this holiday season. "Excess production capacity has lowered LCD panel prices, and that has dropped the prices of LCD TVs. The prices of many other consumer 'life-style` electronics are falling as well, putting them in direct price competition with PCs," added Gartner.

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