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Report: Media Tablets, Weak Economy Slow PC Sales

Thu, 09/08/2011 - 8:13am
Andrew Berg

Research firm Gartner today downgraded its forecast for the PC market in 2011 and 2012, citing a weakening economy and the growing popularity of media tablets like Apple's iPad.

Gartner says PC unit growth is on pace to total 352 million units in 2011, a 3.8 percent increase from 2010, with better growth by the end 2012, when units are expected to reach 404 million units, a 10.9 percent increase from 2011. Gartner had previously forecast 9.3 percent growth for 2011 and 12.8 percent growth for 2012.

Total unit shipments in 2012 are expected to barely reach 400 million units, which was originally a target for 2011.

The research firm attributed the downgrade to a weakening of the Western Europe and United States markets in the second half of the year.

"Western Europe is not only struggling through excess PC inventory, but economic upheaval as well," said Ranjit Atwal, research director at Gartner, in a statement, adding that U.S. back-to-school sales had proved disappointing.

While the report doesn't foretell the end of the PC market, Gartner analysts are saying that the next generation of consumers has a decidedly novel view of personal computing. 

"More worrisome for the long term is that Generation Y has an altogether different view of client devices than older generations and are not buying PCs as their first, or necessarily main, device," Atwal writes. "For older buyers, today's PCs are not a particularly compelling product, so they continue to extend lifetimes, as PC shops and IT departments repair rather than replace these systems."

George Shiffler, research director at Gartner, notes that media tablets have dramatically changed the dynamic of the PC market and HP's decision to rethink its PC strategy can be seen as an indication of the pressure that PC vendors are under to adapt to the new dynamic or abandon the market altogether.

"Vendors only seem to be flailing as they look for quick fixes to their problems. Unfortunately, the resulting chaos is just creating more confusion across the entire PC supply chain, impacting sell-in," Shiffler says.

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