Global PC shipments declined 3.2% during the first quarter of 2011 (1Q11) compared to the same time last year, according to the International Data Corporation (IDC) Worldwide Quarterly PC Tracker. Although the forecast for the quarter was already conservative – IDC expected a mere 1.5% growth in shipments – a steady but still cautious business mentality and waning consumer enthusiasm persisted. A spike in fuel and commodity prices and the disruptions in Japan added to the mix, further dampening a market struggling to maintain momentum.
The PC market showed clear indications that after more than a year of impressive purchases, frugality tinged with a shift of focus will be the norm for the time being. Despite promising economic sentiments, mature regions appear to be more focused on necessary replacements as a relative dearth of compelling reasons were present to buy secondary PCs. Emerging markets fared better due to lower saturation rates, but also slowed somewhat with Asia/Pacific (excluding Japan) slowing to a 5.6% growth and China continuing to cool off after a momentous 2010.
“While the consequences of events in the Middle East and Japan remain unclear, these will surely be factors that will influence short term market performance for 2011. Long-term success will depend on hardware manufacturers being able to articulate a message that is beyond simple hardware specifications. ‘Good-enough computing’ has become a firm reality, exemplified first by Mini Notebooks and now Media Tablets. Macroeconomic forces can explain some of the ebb and flow of the PC business, but the real question PC vendors have to think hard about is how to enable a compelling user experience that can justify spending on the added horsepower.” said Jay Chou, Senior Research Analyst with IDC’s Worldwide Quarterly PC Tracker.
PC shipments in the EMEA region contracted further than expected in the first quarter, in part the result of continued softness in the consumer space. The business segment also remained cautious, which, combined with sustained high inventory levels in the retail and distribution channel, constrained most vendors’ “sell in” levels this quarter. Growth was expected to remain constrained after a difficult year-on-year comparison and the growth achieved in 1Q10, but demand failed to sustain stronger levels to stimulate higher “sales in” levels in March. The additional impact of the recall of Sandy Bridge systems already in the channel only affected small volumes, but had an adverse impact in terms of cancelled and delayed orders and contributed to some additional disruption.