IDC Cuts 2002, 2003 PC Forecasts

A mid-year sales jump fizzles as businesses and consumers make due with old Dells and get by with last year's Gateways, the Framingham, Mass., researcher says.
With confidence in the economy still shaky, businesses and consumers are making due with old Dells and getting by with last year's Gateways, according to IDC.

Because of this wariness, the Framingham, Mass., market researcher has lowered its worldwide PC sales projections for 2002 and 2003.

Shipments will hit 135.5 million, on growth of 1.1 percent this year, with growth of 8.4 percent predicted for next year. In June, IDC believed the market would grow 4.7 percent in 2002 and 11.1 percent in 2003.

"The momentum we saw coming into the second quarter has all but disappeared as businesses continue to postpone PC investments and consumer spending has slowed," said Loren Loverde, director of IDC's Worldwide Quarterly PC Tracker.

Consumers, who account for about a third of all new PC purchases, could bolster the numbers in the last four months of the year, but indications show they too are exercising caution.

Two bright spots are the public sector and small businesses, which are "spending for the moment." Loverde said. A significant recovery, however, won't occur until until both consumer and business demand picks up and it may be "the middle of next year before that happens."

Roger Kay, director of client computing at IDC, said the sluggishness of the corporate market can be attributed to several factors: higher costs of capital because of poor stock performance and layoffs and hiring freezes.

"Saturation is also increasingly a factor, as the mature U.S. market swings over more fully to a replacement model," Kay said. "To remain viable, vendors will have to adapt their distribution strategies to these new realities."

Western Europe's market continues to be slow in emerging from its economic doldrums. The Japanese market came close to hitting its IDC's predictions in the second quarter, although a lack of confidence in the banking sector could hurt future sales.

Markets such as China, Australia, and India will keep regional growth above 10 percent for 2002.






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