Despite warnings from some companies, analysts say the sky isn't falling on the PC market -- at least not yet.
On Monday, International Data Corp released preliminary PC market share results for the third quarter of this year. The results, the Framingham, Mass.-based market-research firm says, show strong growth in consumer PCs. However, there are at least two areas of concern: the North American corporate market and Europe in all markets.
"There's been a lot of nervousness because of some of the vendor earnings statements," said Bruce Stephen, group VP for personal systems research. "On the whole, from where we sit, the industry looks pretty good."
Consumer demand, portables, and the Asian economic recovery have driven third quarter sales volumes, which were up just over 18 percent versus the same quarter a year ago, according to IDC. The firm says 33.3 million units were sold, just under its earlier prediction of 33.4 million units.
IDC's two areas of concern were Europe as a whole, where PC sales grew slower than the overall market, and North America, where corporate PC sales are down.
European currency exchange rates and general economic jitters have lead to lower demand for new PCs. Meanwhile, corporations in the U.S. are in a buying lull, following a frenzy of Year 2000-related PC purchases, IDC said.
"I think they went though a pretty intense upgrade cycle around (preparations for) 2000," noted Stephen.
However, upgrades to Microsoft's Windows 2000, next year will grease the skids for another buying cycle, Stephen predicted.
Compaq takes the No. 1 spot
When it comes to market share, the preliminary IDC numbers show Compaq Computer Corp., Dell Computer Corp. and Hewlett-Packard Co., were the top three worldwide PC vendors with 13, 12 and 8 percent share, respectively.
All three vendors experienced some of the European sluggishness, growing at rates lower than the market as a whole, Stephen said.
Dell basically held steady, while HP overtook IBM Corp. by about 150,000 units. HP saw itself in a virtual tie in second quarter market share with IBM, according to IDC.
At number four, IBM may have sacrificed market share in favor of profitability, Stephen said. Fujitsu-Siemens remained number five.
When looking at the North American market only, Dell remained on top, with a 20 percent share. However, Compaq, with 16.5 percent, and HP, with 11 percent, gained ground on the Round Rock, Texas, PC maker. In North America, HP grew by nearly 47 percent from last year.
Meanwhile, IBM and Gateway, Inc. fell behind in the North American race. Fourth-place Gateway grew by just 1.7 percent, while IBM lost a whopping 19.5 percent of its market share from last year. IBM's loss in share reflects its exit from the retail market earlier in the year, Stephen said.