PC Sales Slow Slightly

Despite expectations that worldwide PC shipments over the next two years won't match figures for 2003, double-digit growth remains likely through 2005, a new report suggests.

Worldwide PC shipments are now expected to grow by 11.4 percent in 2004, and by 11.2 percent in 2005, according to the Quarterly PC Tracker estimate released this week by market research firm IDC (a division of International Data Group, parent company of the IDG News Service and of PC World). Those projected figures compare with an actual 11.7 percent growth rate in 2003, reflecting 154.5 million units shipped, IDC says.

"This is not the growth rate of the late '90s, but it's still pretty healthy," says Roger Kay, vice president of client computing for IDC, based in Framingham, Massachusetts. "The late '90s were a period of accumulation and we're now past that point."

Beyond 2005, growth in worldwide PC shipments is projected to slow to about 8 percent per year through 2008, IDC says. Shipment value is expected to grow by more than 5 percent annually for the next two years, followed by growth of roughly 3 percent per year through 2008.

Going Mobile

Consumer and enterprise interest in laptops and wireless technology is a driving factor in the market's growth worldwide, but especially in the United States and Western Europe, Kay says.

"Wireless is becoming a check-box item for businesses," he says. "Part of the reason for that is because enterprises are having to deal with employees who are doing wireless on their own at home, which does raise some security issues for companies."

IDC expects 172.1 million units to be shipped worldwide in 2004, with the United States accounting for 58.5 million of those units. The worldwide commercial sector in 2004 can anticipate shipments of 109.9 million units, a growth rate of 12.1 percent, while the consumer sector is forecast to have 62.1 million units shipped, for a 10.2 percent growth rate.

"Enterprises have cannibalized their closets so to speak and now need to refresh technology with new PC purchases," Kay says. "Meanwhile, consumer spending is still growing, despite poor job growth. Consumers haven't been tapped out in terms of their PC spending."

U.S. demand for laptops (or portables) is projected to rise by 30 percent over the next two years, growth that will more than offset an expected decline in public-sector spending, due in part to this year's presidential election. "Election years throw funny things into IT spending projections. For example, questions about future tax polices become an issue," Kay says. Spending in the government sector is likely to drop, especially in the areas of education and federal projects, he says.

Around the World

In Western Europe, both consumer and business demand will remain strong into 2005 due to rapid adoption of portables and to improving price points, IDC reports. "Western Europe is forecast to be slightly stronger than the U.S. in 2004, though that will most likely reverse in 2005," Kay says.

IDC also anticipates PC market growth in Japan, from 2.8 percent in 2003 to around 6 percent in 2004 and 2005, while the Asia-Pacific region in general should remain in double digits throughout the period. "China is really the engine in the region, though India is becoming very interesting and also showing strong growth," Kay says. "The Asia-Pacific market was underpenetrated but is now in full-swing."