Cannibalisation of smartphones dealt a major blow to the PC and tablet markets in the six Gulf Cooperation Council (GCC) countries in the first three months of the year, with tablets taking a bigger hit.
Fouad R. Charakla, senior research manager at International Data Corporation (IDC), told TechRadar Middle Eastthat there has been a considerable decline of 7.6% in the regional PC sales to 740,489 units compared to 801,369 units a year ago.
He believes the shortfall of Intel chips in the market also had an impact on PC sales, mainly in the entry-level CPU shipments. “From what we learned was that Intel was prioritizing the supply of high-end CPUs, so, entry-level CPUs suffered. There were some cases where PC manufacturers considered shipping with AMD chips to fill the gap,” he said.
Ranjit Atwal, research director at Gartner, said that vendors had to change their mix due to the shortfall related to production issues. “It is the entry level of the PC market that had a bigger impact. The top three vendors – HP, Dell and Lenovo – got most of the chips they needed while the rest of the vendors weren't getting enough supplies. The three top players have 60% of the market between them,” he said.
Although the chipmaker has invested $1.5 billion more to boost its production, Intel’s CEO Robert Swan said during their earnings conference call recently that supply challenges will persist throughout the third quarter and increased capacity will improve its position in the second half of the year.
“The new Intel CEO had said that these kinds of shortfall will never happen again but we have to see what the changes they are going to implement,” Atwal said. He also thinks that the roadmap for AMD is currently quite looking good for vendors that need another supplier.
Windows 10 helps PC growth in commercial sector
Charakla and Atwal said that the consumer demand for PCs declined significantly, while the commercial sector, on the contrary, achieved growth. “The business sector is positive for the last two years as users move to Windows 10,” Atwal said.
According to StatCounter, the global desktop and laptop market share for Windows 10 was 56.24% in April 2019 compared to 46.07% in April last year. Gartner analyst predicts that Windows 10 will represent 75% of the professional PC market by 2021.
In the GCC, desktop shipments rose about 8% while laptop sales plunged around 15%.
During the same period, the regional tablet market fell 19 per cent year on year to 618,676 units compared to 759,763 units.
“The significant portion of requirements for tablets is fading away and or satisfied either with a laptop or a smartphone,” Charakla said.