Asia ready for a PC market comeback

Market research firm IDC Asia-Pacific believes that the worst is over for Asia's personal computer sector, with recovery anticipated in the second half of the year.

SINGAPORE--Market research firm IDC Asia-Pacific believes that the worst is over for Asia's personal computer sector, with recovery anticipated in the second half of the year.

“We're seeing a glimmer of hope for the first quarter, with the regional PC market expected to grow 12 percent this year," Bryan Ma, IDC Asia-Pacific research manager for Personal Systems.

The positive outlook is bolstered by signs of revitalized economics across the region with many countries resuming their growth path in mid-2002, Ma told CNETAsia in a telephone interview today.

For this quarter, Ma forecasts that Asia-Pacific (excluding Japan) is expected to grow by 4 percent year-on-year.

In the last quarter, only China and Thailand performed well with growth rates of 12.1 percent and 7.6 percent respectively, IDC said in a statement.

China's PC shipment grew by 264,000 units to 2.45 million units in the fourth quarter of 2001 as compared with the corresponding period in 2000, while Thailand saw an increase of 10,400 units to 147,900 units.

The worst performer for the fourth quarter last year was Singapore where PC shipment fell 24.3 percent to 101,700 units, IDC said.

In total, Asia-Pacific shipped 5.65 million units in fourth quarter of 2001, representing a mere 1.9 percent increase from same period a year before.

"While consumer and corporate buying may not have returned to the level attained in 2000, the declines have been less drastic than previously expected given the tragic events that have unfolded since September 11," Ma said.

On market leadership, Ma said that China's Legend Computer was still in pole position with an approximate 12.9 percent market share. It shipped 730,000 units last quarter, representing an 8.5 percent growth year-on-year.

Dell emerged the winner in terms of year-on-year growth. It shipped about 273,000 units, an increase of 20.6 percent in the fourth quarter compared with the same period in 2000.

Compaq achieved a modest 8.4 percent growth in the last quarter but IBM, Samsung and HP declined in terms of year-on-year growth performance, IDC said.

Meanwhile, financial conditions for the information-technology industry will remain tough this year, according to a report by research firm Gartner, which predicted more job cuts and business failures.

The forecast is included in a compilation of top 10 technology predictions from various Gartner analysts, reported CNET News.com.

While increased IT spending in the Asia-Pacific region is likely to prompt a slight recovery for the year, the industry will continue to go through a shakeout, Gartner predicted.

Economic recovery expected for the latter half of the year will help boost demand for IT products and services, the report predicted, but spending will be hampered by lean corporate budgets set earlier in the year. Such financial pressure will push businesses to outsource more IT functions to outside contractors, said Gartner analyst Lisa Stone, a situation that doesn't bode well for internal IT departments.

"Companies want to gain more flexibility," she said. "We see a shift in money moving from the capital budget to the operating budget."

However, the decreased spending overall means even companies that provide contract services will also take a hit.

New IT initiatives--whether outsourced or internal--will be more closely scrutinized as budgets remain tight, Stone added. "It's going to be very focused on bottom-line results," she said.

Staff Writer David Becker contributed to this report.