Despite weak PC growth prediction, Australia remains strong

The worldwide PC market won't grow as fast in 2004 as originally predicted by Gartner analysts, the market research company said Monday.

Gartner still predicts strong double-digit growth for worldwide PC shipments in 2004. PC vendors should ship 185 million units in 2004, a growth rate of 12.6 percent compared to 2003. However, during this year's second quarter Gartner predicted the market would grow 13.4 percent this year.

PC and chip vendors thought shipments in the second half of 2004 would exceed the usual seasonal growth patterns, but it now looks like growth will stick to those historical patterns, said George Shiffler, principal analyst with Gartner. PC growth in Western Europe and Asia-Pacific has been stronger than expected, while growth in the U.S., Japan and Latin America has been weaker than expected, he said.

Notebook PCs have not kept growing at the record pace that PC vendors enjoyed in 2003. However, shipments are still growing at more than 20 percent so far this year, Shiffler said.

"What's happened is that there was a lot of optimism at the beginning of the year, not just for this market but for the overall global economy. That's faded a little bit, but some people have overreacted to that," Shiffler said.

The corporate market is in the midst of a drawn-out replacement cycle as companies replace PCs they bought prior to 2000. This latest upgrade cycle should start to diminish over the next few quarters as companies roll out new hardware, and overall PC market growth rates will start to fall heading into next year and beyond, Shiffler said.

Australian market grows

Meanwhile preliminary Australian PC figures for the second quarter of 2004 were released by IDC on Friday. IDC shows the PC market in Australia shipping 791,079 units (desktop and notebooks) during Q2 2004.

The desktop market grew by 8.5 per cent sequentially and by 13.5 per cent from the same period last year. The notebook market grew 7.1 per cent from Q1 2004.

“From a vendor perspective HP saw strong growth, especially from the desktop side of the business, to strengthen its hold on the top position. Dell was the only other vendor able to grow its share among the top 5 with Acer, IBM, and Toshiba each losing ground to the top two vendors,” said Michael Sager, IDC's PC analyst, in a statement.

“Aside from Optima the majority of the local whitebox vendors gave up share to the multi-national vendors during 2Q 2004,” he said.

(Additional reporting by Howard Dahdah).

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