Sales rise by 9.4pc but value drops

By PETER GRIFFIN

PC shipments rose 9.4 per cent last year but aggressive pricing cut the value of the market against the previous year.

About 363,000 PCs, laptops and servers were sold as computer users took advantage of attractively priced bundled deals. Laptop sales skyrocketed.

Researcher IDC said the market, valued at $1.28 billion in 2001 when 332,141 PCs were sold, was probably worth less last year.

The Intel server market grew by 14 per cent. Hewlett-Packard controls just less than half of it.

Analyst Darian Bird said increased sales had been countered by cheap deals, such as Hewlett-Packard offering a home computer set-up in its Pavillion range for around $2000. Other vendors, such as the PC Company, competed fiercely at around that price.

Laptop sales jumped 27 per cent to more than 71,000 for the year. The winner was Hewlett-Packard, with 32.5 per cent of the market, ahead of Toshiba (27 per cent).

Toshiba managing director Steve Ford there were some areas "we could have done better in". He was more upbeat about this year which began with sales of 4500 Toshiba laptops, many as part of a deal with the Ministry of Education. January sales were worth $10 million to the Japanese vendor.

NEC, a small player in the local laptop market, also benefited from greater demand, selling out a two-month supply in one week before Christmas.

"Until about five months ago we weren't really in the hunt but just recently notebooks have taken off substantially," said NEC Computers general manager John Peppiatt.

It was averaging 230 laptops a month. In its Packard Bell desktop PC range, around 730 Machines were selling each month through retail outlets.

Peppiatt said flat-screen LCD monitors were encouraging people to upgrade their computers. "The reality is there are a lot of old computers out there that haven't been upgraded."

NEC's computer business would become profitable for the financial year ended March 31.

"We had a hard year in 2000, 2001 was breakeven, this financial year ending March will be a profit year," said Peppiatt. Bird said fewer than 1000 Tablet PCs had sold since the devices were launched in November. More would be sold this year but the tablet would remain a computing option for "niche parts of society", said Bird.

Dell's Sydney-based marketing manager, Robert Small, said the second-placed computer maker's business had definitely grown in value last year.

He said Dell would start selling a model of projector boasting a footprint smaller than a page of A4 paper in the next few weeks. Final hardware compliance issues were also being worked through to clear the way for the release here of the Axim, Dell's Pocket PC-based handheld computer.

In the US, the Axim is undercutting rivals from Hewlett-Packard and Toshiba and has rapidly picked up market share.

Bird said that without a retail channel, Dell's growth in the consumer market would be limited.

"It's difficult for them, they don't have much experience of the consumer market here and they've no channel. Kiwis like to go into a shop to buy a PC."Overall he expected upgrade fever to hit the industry in the second quarter of the year.