PC global revival hit by UK sales slump

Published on Saturday 28 November 2009 12:22

UK sales of personal computers remain sluggish and are holding back a global revival of the PC manufacturing sector, according to latest figures from a leading technology research analyst.

Gartner has predicted that 2010 will see a "return to growth" for worldwide PC shipments. But such a reversal in fortunes will not be helped if Britain fails to shrug off what has been a prolonged decline in sales here.

UK computer sales during the third quarter of this year totalled 3.3 million units, a drop of 2.4 per cent over the same period in 2008. It is thought by some analysts this is due to the country's slowness in coming out of recession.

Gartner adds that globally a revival in computer sales should still happen. A far healthier situation, it contrasts, with the height of the recession when there were distinct worries the entire PC market might crash.

In 2008 the sector suffered its first fall for six years, and at the start of 2009 an 11.9 per cent drop in revenues was predicted – a decline that would have been four times greater than that in 2001 after the dotcom global crisis.

The turnaround will be fuelled by consumer enthusiasm for low-priced laptops especially inexpensive netbooks, claimed Edward Chance, the former chief executive of Oracle in Scotland who now runs his own consultancy business.

Global laptop sales are expected to grow by 21.2 per cent to 196.4m units next year, driven by a 41.4 per cent growth in netbook sales totalling 41m.

Gartner's principal analyst Ranjit Atwal agreed that mini-notebooks in particular continue to prop-up the computer market and it is no accident that most vendors now offer versions to cost-conscious businesses and consumers.

He added that PC revenues overall could see an increase this year compared with 2008 by 15.4 per cent, but still far short of the sector's halcyon days before the dotcom crash.

Of 2010, Gartner analyst George Shiffler said they were "cautiously optimistic" about the market and he forecast shipments to reach 336.6 million units, or a 12.6 per cent increase over this year.

Hewlett Packard continues to lead the pack in terms of global PC sales. Last week it reported a fourth quarter 14 per cent rise in profits to 1.45bn, and its worldwide PC market share grow to 20.2 per cent from 18.9 per cent one year ago.

IDC, the global market intelligence outfit, said HP has now raised its sales and earnings outlook for the first fiscal quarter of 2010.

But its chief executive Mark Hurd warned that even though he saw encouraging signs of recovery, spending will continue to be prudent in 2010 although better than this year.

Chance pointed out that despite the early success of Microsoft's Windows 7 operating system, this was not necessarily a growth driver: "People don't buy a new PC for a new operating system," he said.

Analyst Josh Farina, of TRB technology market research, said PC vendors were attempting to lay the groundwork "to take advantage of pent up demand once the economic recovery goes into full swing".