Blu-ray sings the PC blues!

EL SEGUNDO, USA: Despite a rapid rise in the sales of consumer Blu-ray players, a fall in their prices and an increase in the number of high-definition movie titles, Blu-ray Drives (BDs) in PC systems have been left singing the blues, according to iSuppli Corp.

By 2013, BDs will be found in only 16.3 percent of PCs shipped, up from 3.6 percent in 2009. The figure presents iSuppli’s forecast of the penetration of BDs in global PC shipments.

iSuppli: Forecast of Global Blu-ray Drive Percentage Penetration in PCs, 2009-2013 (Percentage of Total PC Shipments)Source: iSuppli, USA

“BDs won’t be replacing DVDs as the primary optical drive in PC systems through at least the year 2013,” said Michael Yang, senior analyst for storage and mobile memory at iSuppli. “They eventually will find success, but during the next five years, that success will be limited in the PC segment.”

According to Yang, the two main reasons hampering the adoption of Blu-ray drives in PCs include cost, as well as the lack of a library of movies to justify the need for consumers to move to a different drive in their PCs.

Cost, Yang said, is the primary impediment. Given the high price of the product, consumers are unwilling to pay the extra money in order to obtain a high-definition drive. “The cost issue is amplified by the fact that the library of content is so small that there really isn’t a reason for users to switch at the moment,” Yang added. And while this is changing and studios are rolling out more Blu-ray content every week, there remains a long way to go.

Succession crisis
A tertiary factor worth mentioning is the difficulty of supplanting an incumbent storage medium in PCs—a distinction currently held by the DVD-RW drive.

From a historical perspective, each of the successful storage media in PCs has gained popularity only when content became available and when consumers actually understood that what they were getting was easy to use and worth the cost.

For instance, the once-ubiquitous 3.5-inch floppy drive had a lifespan of 15-plus years, surviving well past its prime. Eventually, it was replaced by CD-ROMs—which, in turn, gave way to DVD drives. A changeover occurred and the floppy disk finally supplanted when it became apparent that CD-ROMs not only offered a distinct advantage but were also the medium being adopted by everything from music to games to movies.

Such a pivotal moment, Yang said, has not yet arrived for the Blu-ray drive. “It’s undeniable that Blu-ray delivers a higher-definition picture, better sound quality and larger storage space for home entertainment,” he remarked. “However, these benefits may have little or no value when viewing the content on a smaller desktop or laptop PC screen and using poor speakers.”

Until BD costs decline and user knowledge increases, the technology will continue to struggle.

Auto head units need to look to PCs for inspiration amid car downturn

EL SEGUNDO, USA: With the automotive industry in the dumps, shipments of auto head units are on the wane as well, an event that should compel OEMs to attract buyers by borrowing a page from the PC industry, according to iSuppli Corp.

Global OEM shipments of auto head units are expected to decline to 48.4 million units in 2009, down 25.1 percent from 64.6 percent in 2008. Shipments won’t recover to the recent peak level of 68.3 million units in 2007 until 2014, when they will reach 69.8 million, as presented in the figure.

iSuppli: Global OEM Head Unit Shipment Forecast (Thounsands of Units)Source: iSuppli, July 2009

The automotive head unit serves as the user interface for cars’ infotainment systems, traditionally providing control of simple functions like CD players but increasingly acting as the front end to a rising number of more advanced features such as navigation systems, Bluetooth cell phone connections, hard disk drives and iPod interfaces.

With the functionality of head units evolving, so must the automakers’ approach to designing them, iSuppli believes.

“Automotive infotainment system and head unit designers could learn much from the development of the PC,” said Richard Robinson, principal analyst, automotive electronics, for iSuppli.

“Early PCs offered a very limited range of default technologies on the motherboard, with additional features like networking, graphics-processing, storage-interface and audio support all handled by ‘plug-in’ solutions, which added to their Bills of Materials (BOMs) and often were difficult to set up.

“As a result of the commoditization all of these applications, it is now practically impossible to sell a PC without a very high baseline of standard technology. With this paradigm shift, typical users now see product differentiation at the software rather than the hardware level, with the PC environment becoming a generic platform, or host, for an extremely diverse range of software applications.”

This high-level of built-in functionality has allowed PCs to move beyond simply running business productivity applications and enabled the support of a wide variety of new entertainment and communications applications based on consumer demand.

“Part of the success of the PC platform is that it is a very customer-focused piece of hardware,” Robinson said. “In fact, with today’s PCs, most users are not concerned with the hardware, but rather with applications.”

Beyond hardware
iSuppli believes automotive manufacturers in their next-generation head unit designs need to rapidly adopt strategies that migrate away from hardware differentiation and move toward a software download/upgrade environment.

It is essential that the burden of mass firmware updates, such as Bluetooth profile updates or new application installs, be passed onto the consumer.

Enabling vehicle-owner downloads via a Web portal will be vital in the more dynamic environment created by consumer devices being bought into the vehicle. This approach would ensure that flexibility is “designed in” for the typical 10-year ownership cycle of a vehicle.

Universal head units
The increasing functionality available on inexpensive devices such as Portable Navigation Devices (PNDs) and Personal Media Players (PMPs) is leading consumers to expect equivalent capabilities from their embedded head units at little or no additional cost.

Because of this, automakers must provide head units that carry sufficient functionality to support the downloading of software on all levels of cars, even low-cost entry-level vehicles.

“The typical buyer of a entry-level vehicle is likely to be younger and more tech-savvy, and will have higher expectations in terms of system requirements than other consumers,” Robinson said.

“Vehicle manufacturers can take advantage of this evolving competitive situation by supporting a critical baseline of head-unit audio, visual and interface features on all models. These high volumes will lead to lower per-unit-costs for head units and increased customer satisfaction.”

Synching with Sync
Ford’s Sync solution has shown that a full-featured hardware baseline and software-driven approach able to span all types of models can succeed, and is heralding a paradigm shift in the design of head units.

“Sync is a reasonably priced, standards-based platform that offers embedded Bluetooth and USB with voice activation for connecting phones and compressed music players,” Robinson said. “Critically, it was targeted at the mass market from the start rather than following the traditional path of starting in a higher-level-specification vehicle and then trickling down to more affordable cars.”

Going forward, iSuppli believes that the new default baselines for audio will include support for analog and digital radio, multichannel speaker support, as well as voice control for accessing flash-based media (iPod/MP3 players). LCD/OLED displays and low-cost navigation are default requirements, with Mobile TV and back-up camera support as strong optional requirements.

PC outlook improves as consumer spending stabilizes shipments

FRAMINGHAM, USA: As in the first quarter of 2009, global PC shipments again came in slightly ahead of expectations in the second quarter (2Q09), lessening fears over the extent of the PC market slump.

Worldwide PC shipments (including Desktop and Portable PCs, but excluding x86 Servers) were down 3.1 percent from the second quarter of 2008 –- a notable improvement over an expected decline of 6.3 percent, according to IDC’'s Worldwide Quarterly PC Tracker.

All regions either met or surpassed expectations. Although the global downturn is still making its effects felt in the PC industry, the slump has been mitigated by a PC market which has seen the computing experience evolve to be more personal, portable, and cost-oriented rather than performance-driven. Portable PCs continue to be the primary driver of volume and growth with all regions seeing strong Portable shipments.

"These results are a very positive indicator for the second half of the year," said Loren Loverde, program director for IDC’s Tracker Program. "We are seeing continued demand from consumers and limited impact from supply chain factors such as inventory balancing.

"New product launches in the second half of the year combined with seasonal growth and greater economic confidence resulting from factors such as government stimulus, a more liquid housing market, relatively stable stock market and interest rates, and progress in the auto and financial industries, should support the expected return to growth by year-end."

While the market has outperformed expectations for a second consecutive quarter, the lack of commercial activity remains a drag on growth. The commercial segment remains more conservative with spending, focusing on other priorities and preserving cash. As a result, the segment has not been as motivated by falling prices and new portable designs as the consumer segment.

“Despite continued contraction from a year ago, the US market managed a better-than-average sequential performance –- an indication of a stabilizing or improving market. While the sequential growth may be a hint of recovery, the market’s focus on lower-price PCs and Mini Notebooks is likely to drag the value of the market to lower levels,” says Bob O'Donnell, vice president, Clients and Displays.

“The market continues to rely on consumer purchases, with a substantial weakness in the commercial space. We expect to see more of the same as we enter the busy shopping season of the second half of the year. In the longer term, an expected recovery in the commercial segment should boost growth in 2011.”

Regional Outlook
United States: The US PC market declined by 3 percent year over year in the second quarter, matching forecasts for the market. Ongoing healthy volume through Retail spurred Portables to exceed forecasts, but that was offset by Commercial sluggishness and Desktop volume below expectations. Dell regained its lead by a small margin, but remains hampered by slow commercial spending.

Europe, Middle East, and Africa (EMEA): In line with IDC's forecast, the EMEA PC market continued to contract for the second consecutive quarter. The Portable PC market performed ahead of expectations, maintaining single-digit positive growth, thanks to continued uptake of mini notebooks in the consumer segment and additional momentum generated by the telco channel. But whilst the consumer market held up well, spending in the commercial segment remained constrained across all form factors.

Japan: Shipments declined slower than expected in the second quarter, with year-over-year growth improving notably from the first quarter. Nevertheless, the Japanese market continues to be plagued by tepid Commercial activity and a Consumer market shifting towards lower cost Portables, which has benefited non-Japanese OEMs with a clear focus on Mini Notebook PCs.

Asia/Pacific excluding Japan (APeJ): PC shipments exceeded forecasts, fueled by very strong Portables growth, particularly in Southeast Asia. China was a bright spot in the region, while India came in close to expectations. Shipment growth returned to positive territory after several quarters of declining volume.

Vendor Highlights
HP: It made further inroads into Consumer Portables through the Retail channel and continued to gain share overall. The vendor grew 3.6 percent year over year worldwide with above-market performance in the U.S. The company also performed well in Europe and Asia/Pacific.

Dell: Although still heavily affected by the Commercial slump, Dell saw good growth from consumer-focused SKUs and reclaimed the number 1 spot in the US. The company continues to restructure operations, develop its Consumer business, and should benefit from an eventual rebound in the Commercial segment.

Acer: It continues to capitalize on its growing channel presence to ship Portables geared toward a wide range of cost-conscious consumers. The company maintained its lead in Mini Notebook PCs while its early entry into Atom-based Notebooks should also pay dividends later in the year. The company saw a significant gain in the US market, likely benefiting from the troubles of Dell and Lenovo.

Lenovo: Its renewed focus on Notebooks and emerging regions produced positive growth following declines in the past two quarters. Solid growth was reported in Latin America and APeJ while yearly declines in mature regions slowed compared to 1Q09. Its home court advantage in APeJ also has led it to focus on a myriad of government stimulus programs, which could pay dividends while riding through the Commercial downturn.

Toshiba: It had a solid second quarter where it outgrew the market in most regions and moved up to the fourth spot in the US. Toshiba's Mini Notebook offering has helped it to weather the storm comparatively better than other Japanese OEMs and it was the only major Japanese OEM to have positive yearly growth in Japan.Table Notes:

* Some IDC estimates prior to financial earnings reports.
* Shipments include shipments to distribution channels or end users.
* PCs include Desktop and Portable PCs (including Mini Notebooks)
* PCs do not include x86 Servers or handhelds. Data for all vendors are reported for calendar periods.

PC market to suffer first decline since Dot-Com bubble!

EL SEGUNDO, USA: For the first time since the Dot-Com bust of 2001, the global PC market will suffer a contraction in unit shipments in 2009, due to a combination of falling IT spending and plunging sales of desktop computers, iSuppli Corp. predicts.

Global PC shipments are expected to decline to 287.3 million units in 2009, down 4 percent from 299.2 million in 2008. iSuppli previously forecasted 0.7 percent growth in PC shipments for the year.

“An annual decline in unit shipments is highly unusual in the PC market,” observed Matthew Wilkins, principal analyst, compute platforms for iSuppli. “Even in weak years, PC unit shipments typically rise by single-digit percentages. The last decline—in 2001—was a 5.1 decrease in unit shipments due to the extraordinary impact of the Dot-Com bust, which caused inflated IT spending levels from the previous years to collapse.”

The primary factor driving the decline in the PC market in 2009 is an expected 18.1 percent plunge in desktop shipments. Unit shipments of desktop PCs will amount to 124.4 million in 2009, down from 151.9 million in 2008.

Entry-level servers -- which iSuppli includes in its definition of PCs -- also will suffer a decline, with shipments falling to 6.9 million units, down 9.5 percent from 7.7 million in 2008.

In contrast, notebook PC shipments in 2009 will rise by 11.7 percent to reach 155.97 million units, up from 139.6 million in 2008. Notebook PC shipments will exceed those of desktops on an annual basis for the first time ever in 2009.

“Mobility is winning out in the PC market,” Wilkins said. “Businesses and consumers continue to embrace notebooks PCs because of the benefits of mobility and the near-equal performance and feature set. This is cutting into desktop PC shipments.” Meanwhile, enterprise spending on IT technology is hurting PC sales.

“Tight budgets are putting the squeeze on corporate IT spending,” Wilkins said. “This is hitting desktop and server sales particularly hard.” The figure presents iSuppli’s forecast of global annual PC shipments.

iSuppli Figure: Global PC Shipment Forecast (Thousands of Units)Source: iSuppli, July 2009

Rocky bottom
While iSuppli is currently correlating its data for second-quarter 2009 PC shipments, iSuppli’s forecast for the second quarter calls for flat shipments rising a scant 0.1 percent to reach 66.54 million units, up from 66.45 million in the first quarter.

In the third and fourth quarters, shipments are expected to rise sequentially by 11 and 8.9 percent, respectively.

“Although our expectation is for shipments to rise vigorously in the third quarter on a sequential basis, conditions remain weak compared to 2008.”

Shipments in the third quarter will be down 6.5 percent compared to the same period in 2008.

However, in the fourth quarter, shipments will rise by 3.6 percent compared to a year earlier. This trend will continue in 2010, with shipments rising on a year-over-year basis during every quarter of the year. For all of 2010, global PC shipments will rise by 4.7 percent from 2009.

Global PC shipments plunge at historic rate in Q1

EL SEGUNDO, USA: Worldwide PC shipments in the first quarter fell by the largest historic rate in the seven years iSuppli Corp. has been tracking the market, as weaker-than-expected desktop sales dragged down the industry, according to iSuppli Corp.

PC shipments in the first quarter of 2009 amounted to 66.5 million units, an 8.1 percent decline from 72.3 million during the same period in 2008, and a 14.4 percent drop from 77.6 million in the fourth quarter of 2008.

“The worldwide recession sparked by the credit crisis slammed PC shipments for the second quarter in succession during the first three months of 2009,” said Matthew Wilkins, principal analyst for compute platforms research at iSuppli.

“The first-quarter performance of the worldwide PC market was worse than iSuppli had expected in its prior forecast, which called for a 4 percent decline in shipments compared to the same period in 2008. After a long period of immunity to the global downturn, the economic crisis finally has begun to impact the PC market.”

The desktop segment was the major culprit for the PC decline, with first-quarter unit shipments dropping by 23 percent compared to the same period in 2008. In contrast, notebook shipments grew 10 percent compared to the first quarter of 2008.Source: iSuppli, June 2009

Top-5 PC makers retain ranks
There were no changes in the rankings of the world’s Top-5 PC OEMs in the first quarter compared to the same period a year earlier.

Hewlett-Packard remained the No.-1 PC OEM for the 11th successive quarter, with its shipments remaining flat from a year earlier at 13 million units. The company held a market share of 19.7 percent.

Dell experienced an 18.7 percent drop in PC unit shipments, declining to 8.8 million in the first quarter, compared to 10.8 million during the same period in the 2008. The company’s market share declined to 13.2 percent, down from 14.9 percent in the first quarter of 2008.

“Dell’s performance in the first quarter was heavily influenced by its weak desktop shipments, which dragged down its overall market share,” Wilkins said.

The remainder of the Top-5 was rounded out by the Asian PC OEMs, Acer, Lenovo and Toshiba, which had market shares of 11.1, 6.7, and 5.2 percent, respectively.

Toshiba posted the strongest growth among the Top-5 on a percentage basis, with its shipments rising by 13.5 percent from a year earlier.

Platform exposure
iSuppli in the first quarter continued to observe strong netbook sales through network operator retail stores. The Top-5 PC OEMs cited sales through such outlets as driving demand for their netbook products.

“The bundling of a low-cost portable computer and an Internet access package clearly has struck a chord with consumers,” Wilkins said. “The reduced upfront pricing of such packages provided by monthly contract plans also has been a strong factor propelling their success.”

iSuppli predicts that netbooks will account for 14 percent of worldwide notebook PC shipments in 2009, up from 9 percent last year.

DRAMeXchange:Win7 RC available to public benefits AIO

TAIPEI, TAIWAN: Microsoft is going to issue public Windows7 RC. The market now focuses on tablet PC and All-in-one PC but Winodws 7 won’t make a significant contribution to global PC sector until next year and DRAMeXchange expects that PC shipments enjoy growth of 8% YOY in 2010.

DRAMeXchange says,now tablet PC and AIO PC is gaining more attention given Windows7 starter edition for 10"1 netbook dosen't support the multi-input touchscreen function.The average price of AIO is around NTD15000 and it also will help the sales once the price goes softer.While the market of AIO only accounts for 5 percent in PC sector,there is going to be a lot of growth for AIO in the future.

NB makers, including Asustek, MSI and HP have launched AIO PC with touchscreen function. DRAMeXchange says, AIO PC is considered for multimedia entertainment and Windows 7 will help it’s sales and develop more touch-screen-related software in order to provide more application to end users.

As to the enterprise market,DRAMeXchange has a relatively conservative view for tablet PC because it costs higher price despite of friendly design for touchscreen use and mobility.

In Taiwan panel sector, DRAMeXchange expects that Wintek,Young Fast,Mildex,J Touch could benefit from Windows 7.

DRAMeXchange states, according to the past, it takes almost one year for the new version OS to widespread. Meanwhile, many companies have cut IT equipment expense for global economy still suffering recession. Therefore, Windows 7 will be the catalyst for PC industry in 2010.