The International Data Corporation (IDC) Worldwide Quarterly PC Tracker yesterday said the PC market saw its steepest decline in sales, in the first quarter of the year, since it started measuring the sector in 1994. This marks the fourth consecutive quarter of year-on-year shipment declines.
IDC revealed the shipment of PCs declined almost 6% more than originally forecast for the first quarter of 2013, dropping 13.9% year-on-year.
The migration to other computing devices and the launch of Windows 8 failing to provide a positive boost to the PC market have been cited as the main reasons for the steep decline. Bob O'Donnell, IDC program VP for clients and displays, says it appears that Windows 8 not only failed, but also slowed the market.
"While some consumers appreciate the new form factors and touch capabilities of Windows 8, the radical changes to the UI, removal of the familiar Start button, and the costs associated with touch have made PCs a less attractive alternative to dedicated tablets and other competitive devices. Microsoft will have to make some very tough decisions moving forward if it wants to help reinvigorate the PC market," says O'Donnell.
Different perspective
According to Gartner, there was an 11.2% decline in PC sales in the first quarter of 2013, with all regions showing a decrease in shipments. It pointed out that the Europe, Middle East and Africa (EMEA) region is experiencing the steepest decline, while PC shipments in the US market totalled 14.2 million units in the first quarter of 2013, a 9.6% decline from the first quarter of 2012.
Principal analyst at Gartner, Mikako Kitagawa, explains the PC is not the preferred computing device anymore. "Consumers are migrating content consumption from PCs to other connected devices, such as tablets and smartphones."
Kitagawa says there is a differentiation in shipment figures between consumer and professional PCs. "Unlike the consumer PC segment, the professional PC market, which accounts for about half of overall PC shipments, has seen growth, driven by continuing PC refreshes. Despite the fact that some regions already passed the peak of PC refresh, overall professional PC demand continued to grow."
Kitagawa says even though the economy has started picking up, it has had little impact on the PC market conditions. "Similar to other mature markets, the US will see the installed base of consumer PCs decrease going forward. This is because many of these systems will not be replaced with PCs; they will be displaced by other devices, or simply retired."
Breaking it down
IDC said HP remained the top vendor, although shipments also showed a double-digit decline of 23% year-on-year for the first quarter. Lenovo followed close behind, surprising with its attack strategy and a double-digit increase in shipments to the US.
The restructuring of Dell led to a global decline of 10%, while sales to Asia/Pacific returned to positive growth. Acer Group also saw a substantial decline in shipments, but managed to increase its market share from 8% in the last quarter of 2012 to 8.1% in the first quarter of 2013, added IDC.
Apple fared better than the overall US market as expected, but still saw shipments decline as its own PCs also face competition from iPads, said IDC.
Earlier this year, IDC predicted the shipment of tablets will surpass desktop PCs in 2013 and portable PCs in 2014. In 2013, worldwide desktop PC shipments are expected to drop by 4.3% and portable PCs to maintain a low growth of 0.9%. The tablet market is, however, expected to reach 190 million shipment units with a year-on-year growth of 48.7%. It also predicts the shipment of smartphones to grow by 27.2%.
Local dip
Computing research analyst at IDC South Africa, Joseph Hlongwane, says locally they were expecting the decline but not this much. "In the first quarter of 2013, PC sales in South Africa declined by 1%. We have been seeing the decline for a few quarters now and we expect it to continue down this path."
He predicts the same trend can be expected for the third quarter of the year with another 1% decline in sales. Compared to the global outlook, Hlongwane says the PC market in SA does not look so dire. "People are still buying laptops, and sales have been boosted by government spending large amounts of its budget on desktops PCs."
Looking ahead, Hlongwane says PC sales in SA will follow the global trend and continue to decline. "We can see it flattening out by 2017, but until then we can expect that sales will continue to decline by 2% to 3%."
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