PC demand grows as tablets falter: IDC
The Middle East and Africa (MEA) personal computing devices (PCD) market (desktops, notebooks, workstations and tablets), declined 5.3% year on year in Q1 2018, according to the latest report from International Data Corporation (IDC).
IDC's Quarterly PCD Tracker shows that shipments fell to around 5.7 million units for the three-month period, which represents the lowest quarterly volume recorded for more than six years.
While the overall PCD market experienced a slowdown in Q1 2018, PC shipments recorded healthy year-on-year growth, with both desktops and notebooks gaining traction across the region, it says.
"The overall market decline stemmed from falling demand for tablets," says Fouad Charakla, IDC's senior research manager for client devices across the Middle East, Turkey, and Africa.
"These devices are falling out of favour across the region, with the biggest year-on-year decline seen in Kenya, where a massive delivery for the education section sector that took place in Q1 2017 was not repeated."
There was a considerable year-on-year decline in PCD shipments to the UAE in Q1 2018, where a significant slowdown in consumer demand was witnessed, in line with IDC's expectations.
"The country had a slow start to the year owing to the introduction of 5% VAT, while April's edition of the renowned IT and consumer electronics sales event, GITEX Shopper, was cancelled," says Charakla.
"However, this decision was well received by the PCD vendor and channel community as it enables them to focus their efforts on the October edition of this event."
On the other hand, South Africa's overall PCD market performed better than expected, with shipments into the country growing year on year, says IDC.
"This was spurred by the country's improved economic situation and the strengthening of the local currency against the US dollar, making it cheaper for PCs to be imported into the country," says Charakla.
"Meanwhile, February's announcement of a 1% increase in VAT encouraged market players to ramp up their shipments into the country ahead of its implementation from the start of April."
Gaming PCs also continue to act as a driver for the MEA region's overall PCD market. "The higher-than-average price points and profit margins associated with gaming PCs is maintaining strong interest among market players in these devices," says Charakla.
The market analyst firm says all the top five vendors maintained their respective positions in terms of market share, with HP taking the lead with a 31.5% share of the market.
In the tablet market, Samsung remained the clear leader and gained market share as well during the quarter, says IDC. Lenovo climbed to second position in the market, overtaking both Apple and Huawei, which came in third and fourth place respectively.
"The sharpest decline in consumer demand in Q2 2018 is expected in the 'Rest of Middle East' sub-region, where recently re-imposed US sanctions against Iran have weakened the country's exchange rate.
"Consumer demand in Turkey, the region's largest single market, will also decline considerably due to the uncertainty and instability surrounding the upcoming elections in June."
However, in the longer term, IDC expects the MEA PCD market to continue shrinking in shipment terms, with slate tablets declining the most rapidly of all the various PCD products.
Global market forecast
Globally, PC shipments have been declining sharply over the last four to five years, says the market analyst firm Research and Markets.
This is due to a combination of factors including market saturation; extended replacement cycles; economic instability in emerging markets; and competition from other consumer devices like smartphones and phablets, it says.
Asia-Pacific and the US experienced declining shipments, while other regions saw some minimal growth, but it was not enough to drive overall growth for the PC industry, says Gartner.
In the first quarter of 2018, PC shipments in Asia-Pacific declined 3.9% compared with the same period last year, while shipments in the US decreased 2.9%. In Europe, Middle East and Africa, the shipments totalled 18.6 million units in the first quarter of 2018, a 1.7% increase year on year.