NEC looks to offload Euro PC business

Plummeting prices and wafer-thin margins are continuing to take their toll, with NEC the latest looking to get out of the European PC market
Written by Colin Barker, Contributor

The European PC market received another blow on Wednesday with NEC's revelation it is in talks to sell the Packard Bell part of its business.

Packard Bell is the name under which NEC sells PCs to consumers and some businesses in Europe. According to analysts at Gartner, the company was the seventh-largest PC maker worldwide in 2005, with a market share of 2.8 percent, and was the largest supplier in Japan.

A spokesman for NEC confirmed to ZDNet UK that the company was in talks with "a third party" to dispose of the business, but would not give any further details.

According to Packard Bell, the company is "number three in Europe", with subsidiaries in the UK, France, Spain, Italy, the Netherlands and Belgium.

PC vendors around the world have been struggling for several years, with suppliers forced to slash prices in the face of ferocious competition from Dell and others.

"It's getting harder and harder out there," Ranjit Atwal, a principal analyst with Gartner, told ZDNet UK. He did not rule out further consolidation, saying that Gartner was "expecting that some of the remaining companies would go down this route".

"Over the next five years there will be a consolidation into the major vendors," Atwal said.

The UK computer industry has been devastated over the last year by the loss of several major PC vendors. Last year one of the largest, Time Computers, went bust, costing companies and individuals millions of pounds, and earlier this month Elonex called in the administrators.

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