PC Market Suffers Decline

The worldwide PC market kept chugging onward against all economic odds, pushed in large part by an emerging netbook market that seemingly popped up overnight. But the ultraportable PCs could only do so much to stave off the inevitable, and according to market research firm iSuppli, the global PC market will suffer its first decline in 2009 since the Dot-Com bust of 2001.
"An annual decline in unit shipments is highly unusual in the PC market," observed Matthew Wilkins, principal analyst, compute platforms for iSuppli. "Even in weak years, PC unit shipments typically rise by single-digit percentages. The last decline -- in 2001 -- was a 5.1 decrease in unit shipments due to the extraordinary impact of the Dot-Com bust, which caused inflated IT spending levels from the previous years to collapse."
The market research firm predicts global PC shipments to dip to 287.3 million units in 2009, marking a 4 percent drop from the 299.2 million shipments in 2008. Ironically enough, a growing notebook market -- which we assume also includes netbooks -- might be part of the reason for the overall drop in PC shipments. While notebook PC shipments will rise by 11.7 percent, desktop PC shipments, including entry-level servers, is expected to plummet 18.1 percent and is being cited as the "primary factor driving the decline of the PC market in 2009," according to iSupply.
Dell’s plight in recent times is well documented: plunging demand, layoffs and factories closing down. For good measure, it has Acer breathing down its throat. Acer is currently the third largest PC manufacturer in the world, but its rise to the number two slot, currently occupied by Dell, is a mere formality now. Though Dell still doesn’t appear to have found a way to contain Acer, its CFO Brian Gladden believes the PC maker may soon be out of its sullen misery. He said that demand for Dell products, though still inconsistent, seems to have stabilized. He expects Dell’s earnings to be a bit better when it declares its second-quarter earnings in August.

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