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Asia-Pacific PC market on the upswing

Shipments drop 2.3 percent in the third quarter of 1998, a smaller drop than the quarter before, and the downward trend is expected to reverse soon.

Shipments of personal computers in the Asia-Pacific region, excluding Japan, dropped 2.3 percent in the third quarter of 1998, but the downward trend is expected to reverse in the fourth quarter, according to a marketing research firm.

The better than expected results combined with strengthening currency and stock markets bodes well for the regional PC market in the fourth quarter and into 1999, according to International Data Corp. (IDC).

One surprise in the report is that Legend, China's largest native PC maker, has replaced Hewlett-Packard as the third largest computer vendor in the region, with a 5.8 percent market share.

Legend, with about 1,000 distributors, has chalked up a 75 percent annual shipment growth. Its strong gains continue to be fueled by its strength in the Chinese market, a market that many say is set to take off. Despite 25 percent annual shipment growth, Hewlett-Packard dropped to fourth place in the Asia-Pacific market.

Compaq Computer maintained leadership in the regional market with 8.6 percent market share. IBM remained the second ranked company in third quarter after being knocked down a spot in the second quarter of 1998. Nevertheless, IBM managed to increase market share from the year-earlier period by outpacing industry growth.

Acer marginally maintained its fifth place position despite a 24 percent contraction from the third quarter of 1997.

Based on IDC's forecast, PC shipments in the fourth quarter are expected to increase 5 percent over fourth quarter of 1997, which marks the first annual shipment growth since the fourth quarter of 1997. Regional PC shipments in 1999 are forecast to increase 16 percent over 1998, a considerable improvement from an expected 1 percent annual decline in 1998.

Plus, chip giant Intel has said that it expects fourth quarter demand for PC products across all market to be stronger in the fourth quarter, adding credence to the prospect of a regional computer revival.