PC market rebounds ahead of Windows® 7 launch
Consumers are grabbing new desktop and laptop PCs long before the release of Windows 7, signaling robust demand in the market, analysts say.
Improvement in demand for PCs in July and August is "something special” as there was expectation that many people would postpone purchases until after Windows 7 launch, Manish Nigam, head of technology research in Asia for Credit Suisse, said. There were also concerns that the global recession might continue to cripple PC demand.
As per the trend, people wait until after the release of a major new operating system to acquire a new PC for concern of having to shell out money for the upgrade and to prevent the hassle of installing the new software themselves.
However, an aggressive marketing for free or discounted Windows 7 upgrades for new PC buyers before the official launch of the operating system on October 22 has apparently played well.
In a report last week, the market researcher iSuppli said that PC shipment growth fell for six consecutive months, from the beginning of the fourth quarter of last year to the end of the first quarter of this year amid the global financial crisis.
However, with the continuing recovery in the global economy and the hype surrounding Windows 7 launch, sequential growth rebounded in the second quarter and will continue for the rest of this year, the firm added. iSuppli said that the marketing blitz for Windows 7 "will be a major positive for the PC industry".
In a report, Merrill Lynch said that PC shipments last month surpassed its expectations by 3%, as laptop PC demand surged in Europe and sales remained robust in China.
However, computer industry is looking towards corporations, which account for about 60% of PC shipments, to start replacing aging fleets of systems. With issues related to Vista fresh on their minds, executives in charge of replacing PCs are more finicky about major OS upgrades than consumers.
According to analysts big companies will wait until Windows 7 has been on the market for at least several months.
US firms could spearhead the revival in PC market next year, Nigam believes, citing plunge in capital spending to its lowest level in years during the financial crisis.
On the basis of surveys with corporate IT managers, Credit Suisse predicts a 12% surge in corporate PC acquisition next year.
Meanwhile, the PC market is beginning to draw serious attention from Wall Street for the first time in years. Dell shares soared as the firm surpassed earnings expectations for the second quarter.