News

No boost seen in PC sales

• By Michael W. Bucken
• October 21, 2002

In another sign that the economic slump continues, market researcher Dataquest Inc., San Jose, Calif., said corporations worldwide are continuing to postpone personal computer purchases.

Analysts at Dataquest, a unit of Gartner Inc. (http://www.gartner.com), said the modest 5.8% year-to-year hike in the quarter ended Sept. 30 is far worse than it looks as sales in the year-earlier period came to a virtual halt for some time after the Sept. 11 terrorist acts.

''In the third quarter last year, the worldwide market declined 12.4% compared to the previous year, in part because of the shipment stoppages immediately following the terrorist attacks of Sept. 11,'' said Dataquest analyst Charles Smulders, adding that the latest ''year-on-year growth rates artificially inflate the true shipment picture.''

Dataquest research found that PC shipments by Dell Computer Corp., Austin, Texas, grew 20% in the quarter, while Hewlett-Packard (http://www.hp.com) showed some improvement, arresting the pace of decline the combined HP-Compaq Computer had experienced in previous quarters.

Analysts said research found that economic conditions continue to dissuade many corporations from replacing PCs, despite an increasing need to do so as pre-Y2K machines come to the end of their life cycle. In normal economic times, Smulders said, IT organizations would typically replace PCs at this stage.

''In the current environment, and with no economic upturn expected until the first quarter of 2003 at the earliest, this is unlikely to happen until the middle of next year,'' Smulders said. Until shipments pick up, Smulders predicted that IT budgets will be used to maintain the older machines, which will likely adversely effect worker productivity.