IDC: PC sales rising faster than expected

IDG News Service - While notebook PCs have received all the attention over the past few quarters, desktops aren't dead yet. Faster-than-expected growth of desktops is expected to lift the overall market more than previously thought, according to updated data released by research firm IDC today.
Worldwide shipments of PCs are now expected to increase 13.5% for 2004, up from expectations of 11.4% growth released by IDC in March.
In the first quarter, desktop shipments increased 13.4% compared with the first quarter of 2003. The category grew only 9.4% in the fourth quarter of 2003, compared with the fourth quarter of 2002. The fourth quarter is considered the strongest period for PC shipments, while the first quarter is historically much slower.
Desktop PCs account for over 70% of all PC shipments worldwide, IDC said. Any notable increase in shipment growth for desktops will have a substantial effect on the overall market.
As business customers start purchasing PCs in greater numbers, they are choosing desktops more than IDC had expected, said Loren Loverde, director of IDC's worldwide quarterly PC tracker. The strong growth in notebooks over the second half of 2003 had led many analysts to predict that businesses would replace their aging desktops with notebooks, but cost pressures continue to affect business purchases, he said. Notebook PCs are generally more expensive than comparable desktop PCs.
Notebook growth was still strong, at 28.5%, in the first quarter, IDC said. But notebooks grew at a 35% clip in the second half of 2003, showing that buyers are becoming more price-sensitive and selective when it comes to notebook PCs, IDC said.
Businesses are buying notebooks, but they are selectively rolling them out to their users rather than opting for a wholesale replacement of their desktop infrastructures, Loverde said.
Western Europe and the Asia-Pacific region are expected to lead the growth around the world throughout 2004, as those regions begin to replace aging PCs. That replacement cycle has already begun in the U.S. but should remain strong during the rest of the year, IDC said.
The value of PC shipments is also expected to grow this year, but at a slower rate as the industry continues to mature. Total shipment value for 2004 is expected to be $194.5 billion, an increase of 9.2% from 2003.