Gartner Predicts PC Market to Show Growth in Fourth Quarter, Strength in 2010

Gartner has good news for the PC industry. In a June 25 statement, the research firm predicts worldwide PC shipments will reach 274 million units in 2009, a decline of just 6 percent from 2008 shipments of 292 million units.  

Gartner now expects the market to post positive growth in the fourth quarter of 2009, leading to a healthy 2010 market, with units forecast to grow 10.3 percent.  
The prediction is a sunnier reassessment of recent forecasts; in March, Gartner expected a 9.2 percent unit decline, and in mid-May a 6.6 percent decline.
 
“PC unit growth was stronger than we expected in all markets but Eastern Europe in the first quarter of 2009. In particular, consumer shipments were much stronger than we anticipated,” wrote George Shiffler, a Gartner research director, in the statement.
 

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Shiffler went on to say that professional shipments continued to struggle, and that growth in consumer units was due not to demand but the channel restocking it inventories.
 
“We expect units to contract roughly 10 percent year over year in both second and third quarter 2009 before they post positive growth in the fourth quarter.”
 
While mini-notebooks, or netbooks, helped to soften the market’s decline in the first quarter of 2009 — and are on track to reach 21 million units this year and 30 million in 2010 — in the first quarter of 2009 they nonetheless posted their first quarter-over-quarter decline.
 
Shiffler attributed this partly to a contraction in PC shipments to the EMEA (Europe, Middle East, Asia) region, and said that it also “reflects increasing competition between mini-notebooks and low-end mainstream mobile PCs, as the former evolve toward larger screen sizes, and the latter continue to drop in price. In effect, mini-notebooks are becoming just another value-based mobile-PC offering.”
 
Mobile PC units are expected to exceed 2008 numbers by 4.1 percent, to reach 149 million units in 2009, though spending in this area is expected to decline 12.8 percent, as the average selling prices continue to drop at what Shiffler calls “an unprecedented rate,” driven, in part, by the generally sub-$400 netbooks.
 
(Intel, which creates the low-power Atom processor powering many netbooks, introduced a new ultra-low voltage processor on June 2, and seemed ready to usher the market away from netbooks and toward more profitable notebooks. “Ultra-thin laptops are the new phenomenon,” Uday Marty, Intel’s director of basic mobility platforms, told members of the press.)
 
While “mobile PCs” are expected to see growth, Gartner expects desktop PCs to decline 15.7 percent from 2008 numbers, to $125 million, with spending declining 26.6 percent.
 
“The good news for the industry is that delayed replacements won’t be lost replacements,” wrote Shiffler. “Our research indicates replacements should grow strongly in 2010 and 2011, helping to power the market’s recovery.”

Microsoft is releasing Windows 7, its newest operating system, in October, but Gartner analysts expect its impact on the market to be “very modest.”