IDC: PC Outlook Strong — For Now

The outlook for PC sales continues to be in the solid double-digit range
despite many factors that could have stunted growth back into single numbers.

A report released by IDC today forecasts PC growth of close to 15 percent
for the fourth quarter of this year and annual growth to 15.8, a half point ahead of
2004.

“The emerging markets like China and
Latin America have been the story,” Richard Shim, PC analyst with IDC
told internetnews.com. “Sales there have really fueled the market
beyond expectation the past few quarters.”

Although growth is expected to slow in the months ahead, IDC says it’s
encouraged by the strength in the overall market, particularly for portable
PCs. Japan is the only major region where the research firm says sales remain
sluggish.

A slowing market for replacement PCs as well as slower economic growth were
expected to dampen sales further in the fourth quarter, but low-cost
desktops and the allure of portable systems brought in more buyers.

Earlier, IDC had projected 12.6 percent growth for this quarter and 14.1 percent for the year. For 2006, IDC is now forecasting 10 percent.

Portable PCs, which IDC defines as both notebooks and the ultra-light
class of notebook computers, are expected to continue driving growth in the
United States and elsewhere. By the end of 2008 IDC expects portable PCs to
be over 50 percent of all client PC shipments.

Shim says IDC is holding to a conservative growth forecast for 2006
because it expects what has been a phenomenal growth rate to slow down.

“You have a lot of new technology coming along like dual-core, and Microsoft’s new Vista operating system and some people are going to hold off purchasing until they’ve proven to be a value and safe purchase,” said Shim.

“There’s no clear advantage yet to some of the new technology. More applications
still need to be developed for dual-core, for example, to make that
compelling. You’ll see growth [in sales], just not as strong as in 2005.”

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