Consumer portable PCs limit volume decline, but shipment value suffers

FRAMINGHAM, USA: Worldwide PC shipments fell 6.8 percent in the first quarter of 2009 (1Q09), about 1.4 percent better than expected but still the largest decrease since the third quarter of 2001, according to IDC's Worldwide Quarterly PC Tracker.

Although volume declined less than expected thanks to some positive activity in the latter part of the quarter, the Commercial sector and key macroeconomics indicators remain weak.

The growth of Mini Notebook PCs is playing a dramatic role in the market. Mini Notebook PC shipments of 5.7 million in 1Q09 were ahead of expectations, but contributed to a decline of 3.1 million traditional notebooks from a year ago.

The impact on shipment value was dramatic, with Mini Notebook PCs contributing $2.2 billion in the first quarter of 2009 while the value of traditional notebook shipments declined by US$8.4 billion from a year ago. Mini Notebook pricing is expected to rise with more robust models, and shipment growth is expected to slow with the release of low-cost, thin-and-light Intel CULV and AMD Congo-based systems this fall.

However, the growth of Mini Notebooks to 9.5 percent of total PC shipments (17.3 percent of Portables) in 2009 will help drive shipment value down by 17.7 percent even as volumes decline just 3.2 percent.

Mature markets saw growth drop significantly in the past two quarters, but are expected to stabilize and improve going forward. The United States and Western Europe outperformed forecasts as consumer demand was supported by strong ASP declines that were accelerated by growth in Mini Notebook PCs.

Although 1Q09 was promising, shipments in the United States are still expected to decline by just over 2 percent in 2009 and see less than 1 percent growth in 2010. Western Europe saw a limited impact in 4Q08, but saw growth disappear in the first quarter and is likely to see further contraction in 2Q09 before stabilizing –- putting 2009 growth slightly below zero while double-digit growth will not return until 2011.

Projections for Japan were lowered as 1Q09 activity missed expectations, though we continue to expect low-single digit growth in 2010-2011.

Continuing the trend from the fourth quarter of 2008, emerging markets continue to account for the most dramatic shipment declines. Lack of credit along with continued currency devaluation continued a cycle of shrinking resources for channel financing that severely affected Latin America and Central/Eastern Europe.

Canada, along with Latin America and CEMA combined are expecting 2009 to see a decline of more than 13 percent although the region will see double-digit growth in 2010 as it rebounds from 2009.

In contrast to other emerging regions, Asia/Pacific excluding Japan (APeJ) came in slightly above forecast as government spending funneled money to infrastructure improvements and vouchers to stimulate consumer spending. China in particular fared better than hoped. For the rest of 2009 PC growth should accelerate in APeJ, reaching near 12% for 2010, and leading other regions through the end of the forecast.

PC Shipments By Region And Form Factor, 2008-2013* Forecast data
Source: IDC Worldwide Quarterly PC Tracker, June 2009

“The economic crisis continues to dampen PC demand and force changes in the market,” said Loren Loverde, director of IDC’s Worldwide Quarterly PC Tracker. “Mature regions are navigating the changes better than emerging regions in the short-term as finances remain more liquid, but from 2010 forward emerging regions will have the advantage in both growth and volume. Meanwhile, the concentration of growth in the consumer segment and in evolving categories like Mini Notebooks is quickly raising the stakes of competition.”

"Despite a relatively slow first quarter, industry supply chain checks suggest that the worst is over and we are starting to be more optimistic about volume growth at the end of the year and especially into 2010," said Bob O'Donnell, IDC's vice president, Clients and Displays.

"New product introductions coming this fall, including low-cost, thin-and-light consumer portables, low-cost Intel Atom-based all-in-ones, and, of course, Windows 7, should provide a spark that helps to push market towards positive shipment growth over the next 12 months."

PC Shipment Growth By Region And Form Factor, 2008-2013* Forecast data
Source: IDC Worldwide Quarterly PC Tracker, June 2009

Xandros creates enhanced user experience for Netbook users with Moblin V2

COMPUTEX TAIPEI, TAIWAN: Xandros announced it is developing software products based on the recently released Moblin Version 2 project for Intel Atom processor-based platforms.

The new version of Moblin will enable Xandros to provide customizations with advanced Internet, media, social networking and graphics capabilities for the ASUS Eee PC. A turnkey Xandros software solution employing new Moblin v2 technologies will be demonstrated for the first time at the Intel booth at Computex, Taipei, Taiwan, June 2-6, 2009.

The Eee PC defined the netbook revolution by combining fast boot, low-power technologies together with a next-generation user interface. Moblin v2 enables Xandros to further enhance the Eee PC user experience by delivering advanced graphics capabilities such as drop shadows, spin, bounce and 3D animation that are universally available to all applications.

By combining core Moblin v2 technologies with Xandros' own proprietary technologies to provide social networking, multimedia content management, PIM, Web, and other services, Xandros will exceed the needs of today's consumers and provide advanced next generation touch-friendly applications specifically designed for netbook and mobile computer users.

All Xandros Moblin v2 solutions include a rich graphical user interface and an integrated application store with "click and run" access to additional software, games, multimedia and web applications for mobile devices.

"By employing Moblin Version 2 in its future products, Xandros will be able to deliver new, compelling user enhancements to Intel Atom processor-based devices such as the ASUS Eee PC," said Doug Fisher, vice president of Intel's Software and Services Group and general manager of the System Software Division. "Xandros was an early adopter of Moblin technologies and we look forward to its offerings based on the new, community driven platform for Intel Atom processor-based systems."

"The new Moblin 2 for Intel Atom processors provides the foundation to build dynamic interfaces with integrated social networking, to satisfy the media-rich lifestyle of today's mobile users in a timely manner," said Andreas Typaldos, CEO of Xandros. "Working with ASUS on products like the ASUS Eee PC has demonstrated the wisdom of creating Linux-based 'netbooks', and we are excited to be working with the Moblin v2 palate to further enrich the user experience."