Gartner: PC sales looking up for 2003

Barring a major disruption such as a war with Iraq, the PC market should post a modest increase in unit shipments for the year of almost 8 percent, the market researcher says.

John G. Spooner Staff Writer, CNET News.com
John Spooner
covers the PC market, chips and automotive technology.
John G. Spooner
2 min read
Despite economic uncertainty, the PC market will post a modest increase in unit shipments during 2003, according to a new report by Gartner Dataquest.

Gartner estimates that worldwide PC unit shipments will reach 33.2 million units in the first quarter of the year, an increase of 4.8 percent from the same period last year.

For the full year, worldwide PC shipments will increase by 7.9 percent to 138.7 million units, the firm said. During 2002, unit shipments rose only about 1.5 percent.

But the predicted increases for the first quarter and for year as a whole could come undone, Gartner warns, as they hinge on a continued economic recovery, which could easily be derailed by a downturn or a possible military conflict with Iraq.

"In 2003, the outcome of the U.S.-Iraq confrontation will be the key factor influencing the timing of an economic recovery and that timing, in turn, will impact PC sales," George Shiffler, a Gartner analyst, said in a statement. "The uncertainty of the near-term economic outlook is dampening consumers' confidence as well as corporate PC purchases."

Gartner's forecast matches an earlier report from IDC, which predicted that unit shipments will increase by about 8 percent. But IDC, whose research methods differ slightly from Gartner's, predicts that worldwide unit sales will equal 147.5 million during 2003.

The predicted rise in unit shipments for 2003

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would be a marked improvement over last year's scant increase and would certainly be a welcome change from 2001, which saw a decrease of about 5 percent in shipments. But it's well off the pace of peak years, when growth rates well into the double digits were common.

Gartner blames slower-than-average sales of replacement PCs and sales to new customers on the lack of must-have applications. PC buyers, including both consumers and corporations, are keeping their machines longer, the firm has said, extending the life expectancy of their machines to four or five years.

Pricing also weighs heavily on the market, Gartner said. With economic uncertainty continuing, many PC buyers are buying less-expensive machines. Meanwhile, even the least-expensive PCs pack more than enough performance to handle most people's everyday needs--tasks such as writing e-mail or surfing the Web, the firm said.

But even if slowed by the economy, PC sales will recover as companies and consumers begin to replace an aging fleet of PCs, purchased before the end of 1999 in order to avoid year 2000 problems, Gartner said. Companies such as Dell Computer have suggested there are hundreds of thousands of machines that are more than three years old in the market.