November 29, 2004 2:27 PM PST
Are PC makers poised for major hit?
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may retreat into the regional markets that gave them their start. Some companies--namely IBM or HP--might spin off their PC businesses and focus elsewhere, Gartner said.
But HP has no such plans, a company executive said.
"Our business is stronger than ever," said Deb Nelson, vice president of HP's Personal Systems Group, its PC business. "It's a critical part of our broad portfolio of products and services. We're in it for the long haul."
IBM executives have said the same of their company.
"The bottom line here is that the vendor landscape will look very different in the next couple of years," said Leslie Fiering, an analyst with Gartner.
There's still time for PC makers to batten down their hatches and enact cost cuts and other measures that will help them ride out a storm of slow growth and price competition, she said.
For its part, Dell--which can use its relatively low operating costs to reduce prices and still profit--is in the best position for weathering a downturn in demand, Fiering said. The company did so between 2000 and 2002.
A Dell representative declined to comment.
Aside from stealing market share from competitors, the best opportunity for boosting shipments will lie in emerging markets, including China and India, according to Gartner. Unit shipment growth rates will remain relatively high in these markets during 2006 to 2008, Gartner predicts. The situation could help local companies gain more presence on the global stage and hinder larger multinationals, which tend to have a smaller presence in the regions.
Gartner isn't alone in predicting slower PC market growth in the 2006 to 2008 time frame. During September, IDC lowered its forecast for unit shipment growth in 2005 and warned of even slower, single-digit growth rates in coming years.
"It looks like the unit growth from 2006 to 2008 is going to be in the 8 percent range...driven by nondeveloped markets and a steady replacement market in the developed world," Roger Kay, an analyst with IDC, said.
The story is that PC market is maturing and thus moving beyond the stage of massive growth, Kay said.
"Effectively, the world has been explored and there's not a lot of new markets out there," he said. The "market could stabilize in the numbers we're talking about now--150 million to 200 million units per year."
IDC's 2004's PC unit shipment forecast is for shipments of 176.5 million, up 14 percent from 2003.
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