RealTime IT News

PC Growth Declining, But Don't Blame Vista

PC growth is slowing but it has little to do with the recent delay of Microsoft's Vista operating system.

Research firm IDC forecasts PC growth will slow to just over 10 percent over the next several years. In prior years, PC sales grew at an average rate of about 15 percent annually, according to the research the Framingham, Mass.-based firm.

"Despite what others are saying, we don't see Vista as having a serious impact on sales," IDC analyst Richard Shim told internetnews.com. "It could, depending on how Microsoft and its partners handle things this holiday season and what type of upgrade programs they offer, but we don't expect it to.

Shim said part of the drop off in growth from earlier years is a worldwide PC buying cycle that was very strong in 2004 and remained strong last year. "The market can't sustain that kind of growth over three years," said Shim.

That said, there are areas of strength going forward. In the U.S. for example, Shim said he's moved up his forecast of when notebook computer sales eclipse desktops from 2008 to later next year.

"Consumers have been in a kind of mobile purgatory because notebooks always carried a premium price and there was a deficit in performance," said Shim. "But that's changed quite a bit with lower notebook costs and increased battery life so it's not just the commercial market that's driving sales, consumers want them too."

IDC believes the PC market will slow in most regions during 2006, most notably in Western Europe, Japan, although total worldwide growth is expected to be at least 10.5 percent through 2008. This is slightly more optimistic than IDC's November 2005 forecast, which called for growth to slip below 10 percent starting in 2007.

The update reflects a shift of growth from 2006 to 2007 that combines the influence of stronger commercial spending in 2007 with a larger response to Microsoft's Vista release and related developments around digital integration.

Short term expectations for the U.S. and Japan were lowered slightly while IDC's outlook for Europe has improved to reflect continuing adoption of portable computers and a more gradual decline in growth. Overall, worldwide shipment volume is expected to reach 254 million in 2007 with a value of (US) $232 billion.