LONDON, UK, August 8, 2002 - According to final data released today by IDC, UK PC sales performed slightly better than expected, declining by only 0.7% year-on-year in the second quarter 2002. The market continued to be affected by the uncertain economic situation, however, sustained consumer sales, especially in the notebook space, assisted by attractive product offerings, price declines, and increased vendor competition in the retail channel helped lift the market slightly.
Corporate capital investment continued to be constrained from last quarter, inhibited by an ongoing curtailment in hardware spending, with only essential hardware renewals taking place. Increased concentration and competition in the small and medium business (SMB) and public sector markets from both local and international vendors helped limit overall volume erosion, with the commercial desktop market for the first time since 2Q01recording flat growth; however, this should be compared with a soft 2Q01.
" 'Consolidation' and 'value assessment' of current equipment are, at present, the key concerns amongst IT managers in the corporate space," said Rita Sfeir, Research Analyst for IDC's European Personal Computing Group. "The current climate is such that businesses are reluctant to invest in IT products or services without justification that they will visibly aid their business".
Consumer desktop sales in 2Q02, in comparison to a soft 2Q01, saw a decline of -12.4% year-on-year. Consumer demand displayed weaker trends than in the first quarter, with this year's traditional lack of activity in May being exasperated by lower consumer confidence, the World Cup, and the Jubilee celebrations, which contributed to diverting consumer attention away from PC purchases. The increased value and decreasing price differentiation between desktops and notebooks also affected consumer desktop sales, with notebooks taking sales and gaining share. Demand for notebooks continued to remain relatively healthy, as fierce competition from local players remained in the retail channel, and conditions being assisted further by the increased uptake of arbitrage products.
The Intel server market recorded 22.8% year-on-year growth. This is, however, to be compared to a soft quarter a year ago.
"Despite the UK market showing slight signs of improvement, the prospect of a return to more positive growth is not expected until the end of 2002 and early 2003", said Rita Sfeir. "Healthier trends are expected to be driven by a rebound in corporate investments and a boost in notebook sales through the advancement of broadband and wireless technology," she added.
Vendor Performance Highlights
HP, thanks to the acquisition of Compaq, took the number one position in the UK, with 7.4% year-on-year growth and 22.5% market share. Aggressive pricing from HP during the quarter, aimed at accelerating the product transitions in the channel, helped boost volumes, with the combined results of both entities increasing in share from last year. The merger between HP and Compaq contributed to reinforce an already highly intensive environment.
Dell dropped one position, declining by 1.3%, being affected by weak corporate investments and its lack of retail presence affecting its consumer sales. The vendor faced increased competition from indirect vendors, especially in the retail space. Dell, however, maintained pressure on the corporate market, while continuing to expand into the SMB market.
NEC CI moved up one to third position, recording a 2.4% year-on-year growth. Overall performance was driven by important share gains in the business space through its NEC CI brand, benefiting from its investment in the corporate space and major deals won in the public sector. However, the vendor suffered in the consumer space from a delay in refreshing its product offering as well as fierce competition in the retail channel from local players.
Toshiba, for the second quarter running, maintained leadership of the UK notebook market with 18% year-on-year growth, and moved up into fourth position in the overall ranking, with total growth at 14.2%. The vendor benefited from its improved relationship with its retail partners, especially DSG, and its success through investment in its mail order and distribution channels. The vendor also benefited from developing and clarifying its varied product range through effective product and price positioning.
IBM moved up into fifth position in the UK market despite being inhibited by a constrained corporate environment. The vendor benefited from the continued success of its Top Seller channel program as well as in the notebook business market where it gained market share and grew above the market average, displaying 13.2% year-on-year growth.
Time Group, through its acquisition of Tiny Computers at the beginning of the year, has moved into sixth position in the UK PC market, benefiting from sustained consumer and SOHO sales in the market place. The vendor also benefited from its presence on the high street through its refreshed and re-branded "Computer World" stores and its pro-active sales and marketing activities. The Group also benefited from having inked a deal with Tesco to supply computers, this channel being a new development for Time and Tiny brands which had always been sold direct to the consumer.
Top Five Vendors, UK PC Shipments,
2Q02 (Final)
|---------------------+---------------------+--------------------->
| | | |
| | | |
| Vendor | 2Q01 | 2Q02 |
| | | |
| | % Unit Share | % Unit Share |
| | | |
|---------------------+---------------------+--------------------->
>---------------------|
| |
| |
| Unit Growth |
| |
| 2Q02 vs. 2Q01 |
| |
>---------------------|
|---------------------+---------------------+--------------------->
| | | |
| | | |
| HP (1) | 20.8% | 22.5% |
| | | |
|---------------------+---------------------+--------------------->
>---------------------|
| |
| |
| 7.4% |
| |
>---------------------|
|---------------------+---------------------+--------------------->
| | | |
| | | |
| Dell | 18.5% | 18.4% |
| | | |
|---------------------+---------------------+--------------------->
>---------------------|
| |
| |
| -1.3% |
| |
>---------------------|
|---------------------+---------------------+--------------------->
| | | |
| | | |
| NEC CI (2) | 6.8% | 7.0% |
| | | |
|---------------------+---------------------+--------------------->
>---------------------|
| |
| |
| 2.4% |
| |
>---------------------|
|---------------------+---------------------+--------------------->
| | | |
| | | |
| Toshiba | 4.2% | 4.8% |
| | | |
|---------------------+---------------------+--------------------->
>---------------------|
| |
| |
| 14.2% |
| |
>---------------------|
|---------------------+---------------------+--------------------->
| | | |
| | | |
| IBM | 4.3% | 4.1% |
| | | |
|---------------------+---------------------+--------------------->
>---------------------|
| |
| |
| -3.2% |
| |
>---------------------|
|---------------------+---------------------+--------------------->
| | | |
| | | |
| Others | 45.4% | 43.1% |
| | | |
|---------------------+---------------------+--------------------->
>---------------------|
| |
| |
| -5.7% |
| |
>---------------------|
|---------------------+---------------------+--------------------->
| | | |
| | | |
| Total Units | 100% | 100% |
| | | |
|---------------------+---------------------+--------------------->
>---------------------|
| |
| |
| -0.7% |
| |
>---------------------|
Source: IDC EMEA, Final Results, 2Q02
Shipments are branded shipments and exclude OEM sales for all vendors. Data for all vendors are reported for calendar periods.
(1) Data for HP includes shipments for HP and Compaq
(2) Data for NEC CI includes shipments for NEC and Packard Bell About IDC IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world's leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at www.idc.com.
IDC is a division of IDG, the world's leading IT media, research and exposition company. # # #
All product and company names may be trademarks or registered trademarks of their respective holders.
For more information, contact:
Rita Sfeir
+44 (0) 20 8987 7229
rsfeir@idc.com
Karine Paoli
+44 (0) 20 8987 721
kpaoli@idc.com
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