Strong ASP declines and vendor competition for channels fuel portable demand across EMEA regions
13 Aug 2008 - PC shipments in Western Europe reached 13.8 million units in the second quarter of 2008, a 25.8% increase compared to last year, according to Context data. Market growth continued to be driven by the mobile PC segment, which saw unit sales increase by 40% vs. the prior-year period. While lasting growth in the mobile sector continues to be based on the increasing importance of mobile computing within personal technology, demand for portable PCs was also fuelled this quarter by sharp ASP declines, a continuously strong Euro that allowed for cheap component sourcing, and rising vendor competition for distribution channels. Further, mobile demand benefited from product refreshes focusing on technology and design, and from the momentum gained through product launches in the ultra low-cost segment. In the increasingly significant Central and Eastern European markets, mobile growth by far outperformed Western European levels, albeit from a much smaller basis. A strong decline in portable ASPs in many cases allowed users to opt for mobile rather than desk-based computing, resulting in a 96% year-on-year growth in Portable sales vs. a 33% growth in Desktops, with the total number of portable systems shipped almost equalling that of desk-based machines.
Regional Highlights
The three largest Western European markets, U.K., Germany and France, all registered double-digit PC growth rates based on strong mobile performances. The U.K. grew consolidated PC unit shipments by 31% vs. last year, to 2.9 million units. Its mobile segment made up a drastic 57% of all PC units shipped this quarter, up from 48% last year. Germany grew PC shipments by 24% compared to Q207, driven by a lasting mobile demand that made Portable unit sales go up 29% vs. last year. France, in turn, grew consolidated PC unit sales to 2.2 million units, an increase of 28% vs. last year that was largely based on a 41% year-on-year growth in the mobile PC segment.
PC shipments in the Central and Eastern European markets reached almost 6 million units, up 56% from the prior-year period. Amongst the most significant and strongest growing markets in Q208 figured Russia, which grew its PC unit shipments to 2.8 million, up almost 80% from Q207; Ukraine, which almost doubled its PC unit sales vs. last year and registered 925,290 unit shipments; and Poland, which sold 581,000 PC units vs. 507,000 one year ago.
Vendor Highlights
-HP maintained its leading position with a 24% market share in the Western European region. Despite a sluggish performance in the Desktop segment (1% growth vs. last year), HP achieved a consolidated PC growth of 26% compared to Q207, largely based on a strong performance in the Notebook sector. Clearly, HP continues to benefit from its strong channel strategy and ability to execute, and was able to leverage its recent product announcements. In Q208, HP led the market in the Western European and Central and Eastern European Desktop and X-86 server segments, as well as in the Intel-based PC Workstation segment in the Central & Eastern European region.
-Acer continued to leverage the strong demand for portable systems and brought up Notebook sales by 62% vs. last year (Q208 figures include Packard Bell). The vendor's operations have so far remained surprisingly unaffected by its acquisition of Packard Bell and the ensuing integration activities. Acer was one of the few vendors this quarter who registered strong Desktop growth despite the slow demand reigning in this sector. As a result, the vendor's consolidated PC market share rose from 15% last year to 19% in Q208 in the Western European region.
-Dell this quarter managed to maintain the momentum gained in Q1. While suffering from sluggish desktop sales, the vendor performed well in the Portable, Workstation and X-86 server segments, growing its consolidated PC units at 18% vs. last year in the Western European region. Given the company's strong current focus on regaining market share across Europe, we expect Dell to perform well in 2H08.
-Toshiba was able to continuously leverage the strong demand for portable products. The vendor grew portable PCs by an impressive 44% vs. last year, leading to an increase in PC market share to 6%, up one percentage point from last year.
-Fujitsu Siemens was the only top vendor to see consolidated PC unit sales across Western Europe decline this quarter. The vendor's sales went down 10% in Q208 vs. last year, based on shipment declines in the Desktop and Notebook segments that a positive growth in X-86 servers was unable to offset. As a consequence, FSC's PC market share in Western Europe declined from 8% last year to 5% in Q208. We believe FSC's shortfall in sales, and its failure to leverage the demand coming from a buoyant portable market, were based on delays in new product introductions, as well as the vendor's decision to disengage from unprofitable Desktop and Notebook consumer deals.
-Asus in Q208 continued its outstanding performance of the past few quarters, and leveraged the momentum gained from the successful introduction of the Eee PC. The vendor grew its portable systems by 95% vs. last year, to 417,000 units.
-Apple was another vendor this quarter who benefited from the booming mobile market, with unit sales in this segment up 39% vs. last year. In addition, Apple managed to strongly grow desktop sales in Q208. With a desktop unit growth of 82% vs. last year, Apple by far outgrew the average market and secured itself a strong PC market share gain in the segment.
Top Five Western European PC vendors Q208 vs. Q207
| Q208 shipments | Q208 Share | Q207 shipments | Q207 Share | Y/Y Growth | ||
|---|---|---|---|---|---|---|
| 1. | HP | 3,378,197 | 24% | 2,683,276 | 24% | 26% |
| 2. | Acer | 2,591,857 | 19% | 1,649,210 | 15% | 57% |
| 3. | Dell | 2,154,476 | 16% | 1,830,200 | 17% | 18% |
| 4. | Toshiba | 792,709 | 6% | 552,497 | 5% | 43% |
| 5. | FSC | 760,646 | 5% | 844,641 | 8% | -10% |
Outlook
The strong demand for mobile systems has been the growth engine behind PC sales across Europe for quite some time now. Clearly, this reflects the increasing importance of mobile computing within personal technology, an importance that has so far been able to resist rising economic pressures. However, these pressures are mounting and might well have an effect on overall PC - and mobile - demand in Western Europe in upcoming quarters. In the U.K. for example, there are clear indicators that the credit crunch has begun to spread from the financial sector to other areas of the economy. While vendors are likely to react by increasing their efforts of growth in new and emerging markets, such as Eastern Europe, the top vendors might also use their size and financial backgrounds to counter a possible decline in demand with more aggressive pricing in their traditional markets. This will make it difficult for smaller vendors to compete and might eventually even lead to increased vendor consolidation
About Context:
Context has a 25-year history of providing facts-based data and competitive analysis on Europe's business and consumer information technology markets, and in that time has established itself as a trusted business information partner with 7 out of the world's top 10 computers and peripherals companies.
For more information on CONTEXT PC Reports, please contact Eleonora Betancourt on:
Tel: +44 (0)20 8394 7753
email: ebetancourt@contextworld.com
For more information on this press release, please contact Paola Troili on:
Tel: +44 (0)20 8394 7725
email: ptroili@contextworld.com
