Replacement cycle expected to spur PC shipment spike

Worldwide PC shipments are set to bound 13.6 percent this year over last, driven by a Y2K replacement cycle and the loosening of corporate purse strings amid signs of economic growth, Gartner said Thursday.

The researcher predicted that global PC shipments would reach 186.4 million units in 2004, in great part due to the estimated replacement of 100 million PCs this year. What's more, the replacement cycle is forecast to continue into next year, when 120 million PCs are expected to be shut down in favor of newer models.

The corporate PC replacement cycle has been pushed from three years to four, so all the computers bought in the run-up to Y2K are now due to be refreshed, said Gartner analyst Ranjit Atwal. Although the spike in new PC purchases is not going to be the same as immediately before 2000, the industry will see steady growth in PC shipments throughout the year, he said.

Over 30 percent of installed PCs are over three years old and running older versions of Microsoft Corp.'s Windows operating system, which are about to lose or no longer have technical support, Gartner said. A desire for adequate tech support, coupled with the boost given by recent global economic growth will help fuel sales, the researcher said.

Businesses will still be trying to keep costs down, however, with a majority of purchasing aimed at lower-end PCs, according to Atwal. The trend toward replacing desktop PCs in certain segments of the market with slightly pricier mobile PCs is expected to continue, however, especially among retail and small office and home office users.

"Acer (Inc.) has done particularly well due to their lower price-point initiative," Atwal said.

Second quarter 2004 shipments already look strong, with Gartner projecting that shipments for the period will come in 14.3 percent higher than in last year's second quarter.

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Scarlet Pruitt

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