Recession Promises Slow Finish to 2010 for PC Market

In many parts of the country, kids are just getting ready for another year back at school. And although this usually means a lengthy spike in sales for electronics retailers, industry analysts Gartner predict PC shipments will slow considerably over the rest of 2010.

Although Gartner Research has predicted a 19 per cent increase in PC shipments this year, it believes most of that hike will have come during the year's first half.

In a recent report, Gartner said it expects second-half PC sales to drop 2 per cent from its original forecast, down to 15.3 per cent.

Uncertain Economic Forecast Behind PC Sales Slump

The research company points to troubling economic conditions in the United States and Western Europe, a lasting situation that promises to keep consumers wary about upgrading their systems. (Source: informationweek.com)

According to Ranjit Atwal, Gartner research director, the PC market still faces enormous challenges before returning to normal conditions. "The PC market revived in the first half of 2010, but the real test of its resilience is yet to come," Atwal said. (Source: crn.com)

"Recent dramatic shifts in the PC supply chain were in no small part a reaction to fears of a sharp slowdown in mature-market demand. However, suppliers' risk-aversion is as much a factor in these shifts as any actual downshift in demand."

Need for New PCs Promises Rebound

Although Atwal stands behind his company's prediction that PC sales will slow considerably into the 2010 holiday season, he doesn't believe the market will remain in a rut for very long.

According to Atwal, consumers will eventually begin buying PCs in more significant numbers because the PC is today seen as a 'necessity' rather than a 'luxury,' meaning upgrading to a new and better computer every few years is no longer an option for many people.

As for businesses, they must upgrade sooner or later because slow, outdated and out-of-support computers can hurt productivity.

"Businesses that delay replacing much longer risk alienating employees, burdening themselves with more service requests and support costs, and ultimately facing higher migration costs when they eventually migrate to Windows 7," Atwal said.

"The bottom line is that businesses need to refresh their PCs sooner rather than later. Thus, the full bloom of the long-awaited professional PC refresh can't be more than a few quarters ahead."