Every time you think that the PC market may have bottomed out, it just keeps getting worse. IDC came out with new PC shipment numbers on Thursday projecting that PC shipments will shrink by 9.7% year-over-year in 2013, a downward revision from their earlier forecasts. The big reason that IDC is further lowering its 2013 PC shipment numbers is because tablets have started eating into PC demand in emerging markets, where consumers are much more keen to buy up cheaper mobile computing devices.
“The days where one can assume tablet disruptions are purely a First World problem are over,” says IDC analyst Jay Chou. “Advances in PC hardware, such as improvements in the power efficiency of x86 processors remain encouraging, and Windows 8.1 is also expected to address a number of well-documented concerns. However, the current PC usage experience falls short of meeting changing usage patterns that are spreading through all regions, especially as tablet price and performance become ever more attractive.”
[More from BGR: Huge iOS, OS X vulnerability uncovered that can render apps unusable]
The firm does expect PC sales to rebound somewhat in 2014 when Microsoft will stop supporting Windows XP and when businesses will take “a first serious look beyond Windows 7.”
IDC’s full press release follows below.
PC Outlook Further Lowered as Mature Markets Projected to Outgrow Emerging Markets in 2013, According to IDC
FRAMINGHAM, Mass., August 29, 2013 – Worldwide PC shipments are now expected to fall by -9.7% in 2013, further deepening what is already the longest market contraction on record, according to the International Data Corporation (IDC) Worldwide Quarterly PC Tracker. The new forecast reflects not only a continued expansion of mobile device options at the expense of PCs, but also marked the cessation of emerging market growth that the industry had come to rely on in recent years. The market as a whole is expected to decline through at least 2014, with only single-digit modest growth from 2015 onward, and never regain the peak volumes last seen in 2011.
While the results of the second quarter were in line with forecast, a number of issues led IDC to further downgrade its PC outlook. Aside from stubbornly depressed consumer interest, 2013 also marks the first year where emerging regions are expected to contract at a steeper rate than mature regions. Leading this trend is China’s revised forecast, which calls for a double-digit decline in shipments this year compared to 2012, as channel sources report high levels of stagnant inventory and continued enthusiasm for tablets and smartphones. The repercussions of a slowing China, anxiety over the possible tapering of the U.S. quantitative easing program, and weak intrinsic PC demand, are among a litany of factors that have rippled across portions of other formerly strong-growth areas, leading emerging markets as a whole to see declines through at least 2014.
“The days where one can assume tablet disruptions are purely a First World problem are over,” said Jay Chou, Senior Research Analyst, Worldwide Quarterly PC Trackers at IDC. “Advances in PC hardware, such as improvements in the power efficiency of x86 processors remain encouraging, and Windows 8.1 is also expected to address a number of well-documented concerns. However, the current PC usage experience falls short of meeting changing usage patterns that are spreading through all regions, especially as tablet price and performance become ever more attractive.”
Looking beyond 2014, IDC expects a slow rebound, driven in part by modest consumer refresh of systems whose lifecycle have dramatically lengthened in recent years, as well as businesses taking a first serious look beyond Windows 7. However, without an adequate mass of compelling applications, the PC market is poised to subsist primarily on lukewarm replacements in the future.
“The second quarter of 2013 was the third consecutive quarter where the U.S. market came through stronger than the worldwide market. This was largely due to some recovery in the overall economy and channel inventory replenishment,” said Rajani Singh, Research Analyst, Client Computing. “Following the stronger than expected 2Q13, we expect the second half of 2013 to restore some volume momentum driven largely by better channel involvement of top vendors and industry restructuring/alignment. We also anticipate operating system migration (Window XP to 7) will drive some volume in the commercial segment. Entry-level ultraslim systems and lower-priced convertibles will also be bright spots in an otherwise still troubled consumer market.”
PC Shipments by Region and Form Factor, 2012-2017 (Shipments in millions)
Region Form Factor
Emerging Markets Desktop PC
Emerging Markets Portable PC
Emerging Markets Total PC
Mature Markets Desktop PC
Mature Markets Portable PC
Mature Markets Total PC
Worldwide Desktop PC
Worldwide Portable PC
Worldwide Total PC
Source: IDC Worldwide Quarter PC Tracker, August 2013
This article was originally published on BGR.com
- Investment & Company Information
- Emerging Markets