PC Sales Shrink, but Netbooks on the Rise

Gartner's fourth-quarter 2008 report on the PC market, announced last week, reported shrinking global and U.S. sales for the top computer makers. And it wasn't just the market that had shrunk. The report found that smaller, low-cost, low-tech notebook mini-computers (or "netbooks") have gained ground.

Worldwide, PC sales were the lowest they've been since 2002. Meanwhile, netbook sales became the "growth driver" for the 2008 holidays, according to the research firm.

"The mini-notebook segment outpaced overall mobile PC growth," the report states.

The leading PC vendors in terms of worldwide sales were Hewlett-Packard and Dell, respectively, according to the report. However, third-place Acer gained the largest market share of the top five PC providers.

Acer offered a modest acknowledgment on its Web site, saying that "in the current worldwide economic situation, even though most of the channels have been more cautious and less willing to carry inventory by year-end, Acer's product demand has remained healthy and stable."

Acer had "exceptional" growth worldwide, with shipments of PCs gaining 31.1 percent in the fourth quarter, according to Gartner's report.

The record decline of PC revenue tore into Dell. The No. 2 maker of PCs took a market-share hit, sliding from 14.2 percent in the fourth quarter of 2007 to 13.2 percent in fourth quarter of 2008. It had a near six percent drop in the number of PCs shipped.

Dell has been "plagued by the popularity of cheap Netbooks," the Silicon Valley Insider suggested on Thursday.

The picture for the fourth quarter in the United States mirrored worldwide shipment numbers, according to Gartner. The one exception is that Dell is the No. 1 PC maker in the United States and Hewlett-Packard is in second place. Dell's shipment's declined by 16.4 percent, in part due to a "very weak professional market," according to Gartner.

Hewlett-Packard's shipments were down by 3.4 percent, in the United States, while Acer continued to increase its position in the U.S. market with a 55.4 percent increase in PCs shipped.

In other parts of the world, PC shipments to the East, Middle East and Africa (EMEA) increased by 4.9 percent in the 2008 fourth quarter in comparison with the previous year's fourth quarter. PC shipments to Asia/Pacific grew by 1.8 percent in the same period. The brightest spot for PC shipments was in Latin America, which grew by 10 percent from quarter to quarter.

The decline in global demand for PCs is affecting chipmakers as well. Chip leader Intel reported on Thursday that its net income was down 90 percent from 2007. In November, Intel reported increased sales of its Atom processor, which is used in the netbooks line.

In breaking news on Friday, chipmaker AMD announced it was cutting 1,100 jobs, or nine percent of its workforce, because of the continuing global economic recession.

About the Author

Herb Torrens is an award-winning freelance writer based in Southern California. He managed the MCSP program for a leading computer telephony integrator for more than five years and has worked with numerous solution providers including HP/Compaq, Nortel, and Microsoft in all forms of media.

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