By Lisa Johnston
New products on display at the American International Toy Fair, held in N
Would it be possible to paint a more confusing picture for a market then what is now being portrayed for PCs?Probably not, as various research firms have thrown out all kinds of possibilities. Here are a few of the headlines from TWICE stories that have run in the last few months.
Then today Intel reported $8 billion in sales for its second quarter, well above analyst expectations. This result gives the impression that the PC industry is either rebounding or will soon bounce back to some extent. After all, most PCs are made with Intel processors, so as Intel goes, so goes the industry.
But when you dive a bit deeper into the numbers, a very large disconnect appears. Intel’s better-than-expected earnings owed a great deal to sales of its Atom processor, which is used in the very popular netbook computers. Netbook sales themselves have increased dramatically year over year and, due to their low price tags, are expected to continue to be hot sellers despite, or perhaps because of, the lagging economy.
At the same time, notebook sales rose in the low double-digits and are expected to continue to do so for the remainder of the year, but desktop sales are killing the market. This category may fall off as much as 18 percent this year, according to iSuppli.
What all these numbers are telling me is the PC market is in a very precarious situation. It’s balancing on a knife edge.
If the recession continues and consumer confidence does not rise, then there is a good chance notebook and netbook sales will struggle this year and next year. And they are the only products keeping PC shipments from falling further in 2009 than the 4 percent predicted by iSuppli.
In the end, the back-to-school selling season, which is just getting started, will be the key. If parents can find the money and the desire to spend big, then the positive PC projections will be borne out. However, if parents decide their kids don’t need a new notebook for college, then look out below.
In the end, the trickle-down affect could be tremendous. If money cannot be found for a legitimate educational expense, what are the odds that an extra few bucks will be spent on a new iPod or smartphone on Black Friday?
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.