Slower-Than-Expected Consumer and SMB Performance Limits EMEA PC Year-on-Year Market Growth to 5.4% for Q4 2000, IDC Says

LONDON, JANUARY 23, 2001 – According to preliminary data released by IDC today, the PC market failed to record a healthy performance in the final quarter of the year, with year-on-year growth limited for the quarter to 5.4% and only 9.5% for the full year 2000 in Europe, Middle East, and Africa (EMEA). Sluggish desktop and PC server growth contrasted strongly with impressive notebook growth of 37.9%.

 

Disappointing retail sales, combined with the adoption of a wait-and-see approach from both small and large businesses regarding more powerful specifications of desktop machines and the impact of the strong dollar, significantly impacted results in Q4 2000.

The French market continued to display the weakest performance of EMEA's three largest markets, with a 4.6% decline year on year. Germany continued to record single-digit growth of 4.9%, with business confidence still low and only moderate signs of an improvement in corporate shipments. Small and medium-sized business and consumer performance was also mixed, with slower seasonal results than in 1999. Only the United Kingdom displayed stronger evidence of sustained business demand at 9.1%, with strong server shipments driven by ongoing infrastructure investments. Overall, Southern Europe continued to show double-digit growth, driven by a hardware catch-up in both the consumer and business markets. Emerging markets, in both Eastern Europe and Middle East, also continue to display sustained growth.

The shift toward notebooks has continued in all segments of the market across the region, with an increasing number of notebooks replacing desktops in the corporate environment as many businesses opt to invest in mobile computers, driven by generic changes in working patterns and the potential for increased productivity from employees.

"There has been an inexorable movement toward mobility and pervasive computing as the market shifts away from a PC toward an appliance-orientated era where interoperability and integration are key factors and where communication with devices, such as mobile phones and smart handheld devices, has become fundamental in data sharing," said Andrew Brown, senior research analyst for IDC's Personal Computing Group. “Notebook growth is forecast to continue strongly as both businesses and consumers embrace the benefits of mobility.”

“The PC market has undergone an important transition in 2000. The desktop market has clearly entered a period of flat growth as penetration rates approach saturation on both business and consumer markets, with notebooks beginning to take the place of desktops in the renewal cycle,” said Karine Paoli, IDC's Expertise Centre manager, EMEA Personal Computing group. “If desktops continue to be replaced by smaller form factors and more manageable and easy-to-use appliances, more than one out of three PCs sold will be notebooks in 2002.”

Vendors' Performance Highlights

The sluggishness of the business demand continued to affect desktop and server shipments and impacted major vendors' performance. All major vendors experienced single-digit or negative growth rates. All vendors, however, continued to experience very strong double-digit growth in notebooks, clearly underlining a strong shift of the European market.

Compaq retained clear leadership of the EMEA market, with nearly 16% growth in the fourth quarter as well as for the full year, maintaining the gap between its challengers. Thanks to continued performance of its notebook sales, Compaq moved to gain leadership of the EMEA notebook market in the fourth quarter. Compaq continued to dominate the Intel server space with more than 30% market share.

Fujitsu Siemens maintained its number-two position in EMEA, although growth remained negative, as the vendor's results continued to be affected by the weakness of the German business market as well as strong competition from the leaders in the other European markets. The vendor, however, recorded sustained growth of its notebook shipments.

Dell's results continued to be hindered by the overall desktop market slowdown, affecting the vendor's performance and leading to a single-digit growth rate for the year. However, the leading direct vendor continued to gain share in both the notebook and Intel server marketplace, showing the only double-digit unit shipment growth for servers among the top five players for the full year 2000.

IBM continued to record a healthy performance; however, it was somewhat slower than expected due to poor consumer sales in comparison with the same quarter last year. Elsewhere, IBM continued to show a clear rebound, displaying sustained commercial desktop and server sales. Strong notebook sales also contributed to IBM's healthy results and pushed the vendor in the third position in the notebook market.

Hewlett-Packard continued to display sustained double-digit growth, albeit slightly slower than in the previous quarter. HP also continued to record strong gains in the notebook segment as well as in the consumer market, with an extended coverage of its Pavillion product line, which was very successfully introduced in Germany. HP consolidated its fourth position in EMEA with a strong 22.7% growth for 2000.

Top 5 Vendors, Europe, Middle East, and Africa (EMEA) PC Shipments,

Fourth Quarter, 2000 (Preliminary) (Thousands of Units)

Vendor Units

Q4 1999 % Unit Share Units

Q4 2000 % Unit Share Unit Growth

Q4 2000 v. Q4 1999

Compaq (1) 1,666 15.0% 1,856 15.9% 11.4%

Fujitsu Siemens (2) 1,111 10.0% 1,017 8.7% -8.4%

Dell 821 7.4% 931 8.0% 13.4%

IBM 852 7.7% 920 7.9% 8.0%

Hewlett-Packard 780 7.0% 880 7.5% 12.8%

Others 5,864 52.9% 6,092 52.1% 3.9%

Total 11,094 100% 11,696 100% 5.4%

Shipments are branded shipments and exclude OEM sales for all vendors.

Data for all vendors are reported for calendar periods.

(1) Data for Compaq includes Compaq, Digital Equipment, and Tandem products.

(2) Data for Fujitsu Siemens includes shipments for Fujitsu and Siemens.

Source: IDC EMEA, Preliminary Results, January 2001

Top 5 Vendors, Europe, Middle East, and Africa (EMEA) PC Shipments,

Full Year 2000 (Preliminary) (Thousands of Units)

Vendor Units

Full Year 1999 % Unit Share Units

Full Year 2000 % Unit Share Unit Growth

FY 2000 v. FY 1999

Compaq (1) 5,472 16.4% 5,789 15.8% 5.8%

Fujitsu Siemens (2) 3,684 11.0% 3,467 9.5% -5.9%

Dell 2,913 8.7% 3,174 8.7% 9.0%

Hewlett-Packard 2,267 6.8% 2,782 7.6% 22.7%

IBM 2,800 8.4% 2,751 7.5% -1.7%

Others 16,315 48.8% 18,661 51.0% 14.4%