eGov-Oct-2010-[6-7]-Getting Ready For G2C Play

Analysis

HARDWARE

Getting ready for G2C play Households, the primary citizen groupings, are beginning to lead consumption of PCs—the devices that will access e-Gov services

By Pratap Vikram Singh

W

ith the Indian economy recuperating from the slowdown and expected to grow at 8.5 percent, organisations would be hiring on a big scale and the purchase of desktop and notebook would be on the swing. According to Manufacturers’ Association for Information Technology (MAIT), notebook sales, which had suffered badly in the previous year, made a phenomenal comeback during the fiscal 2009-10 with a remarkable growth of 65 percent year-on-year. This growth was primarily driven by the household segment, which accounted for about 56 percent of the total notebook sales and registered a growth of 87 percent during 2009-10 over the previous year.

In a market analysis, MAIT notes that notebooks are no more restricted to the high-income segment, which used to be the traditional buyer of these devices. Notebooks have started making rapid inroads into the lower income groups as well. Netbook sales were largely driven by the household segment which accounted for almost three-fourth of total netbook sales during 2009-10.

Uptrend in PCs is back The MAIT study did the market segmentation of businesses versus households. It reported

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egov / www.egovonline.net / October 2010

Analysis

HARDWARE

Preliminary Worldwide PC Vendor Unit Shipment Estimates for 4Q09 (Thousands of Units)

Company

4Q09 Shipments

4Q09 Market Share %

4Q08 Shipments

4Q08 Market Share %

4Q09-4Q08 Growth %

HP

17,792.2

19.8

14,239.9

19.3

24.9

Acer

12,188.2

13.5

8,612.7

11.7

41.5

Dell Inc.

10,397.1

11.5

9,839.3

13.3

5.7

Lenovo

7,836.5

8.7

5,509.3

7.5

42.2

Toshiba

4,811.9

5.3

3,668.1

5.0

31.2

Others

37,008.5

41.1

31,855.4

43.2

16.2

Total

90,034.5

100.0

73,724.7

100.0

22.1

Note: Data includes desk-based PCs, mobile PCs and X86 servers.

Source: Gartner (January 2010)

that businesses accounted for 58 percent of the desktop sales with an 8 percent decline in consumption. The decline was on account of high sluggishness during the first half of the fiscal. However, desktop consumption by businesses recovered to some extent during the second half of fiscal 2009-10 with a growth of six percent over the same period last year.

Households’ contribution to the desktop market increased to 42 percent of the total desktop market during 2009-10 from about 34 percent during the previous year. With this, households also registered a growth of 30 percent during 2009-10 over the previous year.

Importantly, the tier-three cities (smaller cities) are driving growth in desktop consumption. It accounted for over 60 percent of the market, though having registered a decline of six percent, in the given year.

Globally, says a recent report from Gartner, PC shipments would increase by 21 percent in second quarter of 2010. The report said that worldwide PC shipments reached 82.9 million units in the second quarter of 2010, a 20.7 percent increase over the second quarter of 2009.

Gartner analysts say that mini-notebook shipment growth slowed significantly in the second quarter of 2010. Mini-notebook shipment growth still exceeded growth rates of the overall mobile PC market, but slowed to 20 percent levels compared with more than 70 percent growth clocked in the previous two quarters.

For the Asia-Pacific region, Gartner says PC shipment will grow by 20.3 percent in 2010. It attributed China and other emerging markets as key to continued growth in the

region. Analysts say that while overall growth in Asia Pacific was strong in 2009, at a country level the more mature markets with high PC penetration exhibited weak PC shipments.

However, the improving worldwide economy should lead to better confidence to invest in 2010, especially in Taiwan, South Korea and Singapore. Similarly in India, PC buyers are now more confident to spend, with employment on the upswing, the report further said.

Between 2009 and 2014, the Asia Pacific PC market will register a compound annual growth rate (CAGR) of 15.7 percent. Emerging PC markets will lead the growth, particularly countries like China and India. South Asian markets such as Indonesia, the Philippines and Vietnam are also expected to perform strongly.

On India, the Gartner study pointed that the country’s economy, which is expected to grow 8.5 percent in 2010, will be the main driver behind PC shipment growth of 19.4 percent, compared to a decline of 3.8 percent in 2009. Interestingly, the study noted that the rural economy is doing better, which should lead to incremental PC sales This opportunity is immense, but its realisation will need more improvements in basic infrastructure, such as electricity and telecommunications, which will take another two to three years.

Peripherals too look up Usually found in meeting rooms at work places, projectors are now being intensively used in educational centres and institutions of learning.

There is an increasing use of projectors in classrooms, as the quality and quantity of relevant

content have improved a lot in the last couple of years. Besides, it is also being used for collaboration and presentations at workplaces.

In the year 2009, as per an industry estimate, the market for projectors grew by over 30 percent on a year-on-year basis. The projector market is supposed to have a 13 to 15 percent growth around the globe. Domestically, it is expected to grow at a CAGR of over 25 percent over the next three years. The consumer spending has also signalled positively, with mobile and tech-savvy consumers’ spending accounting for 12 percent of the projector market.

MAIT estimates that growth for the printer market was six percent during 2009-10. Almost 1.72 million units of printers were shipped during this fiscal. However, though the laser and inkjet printer segments grew at 11 percent and eight percent respectively, the dot-matrix printer segment shrank by three percent over the previous year.

The year 2009-2010 saw the market for keyboards grow by eight percent over the previous year, taking the total number of shipment to 5.8 million. In 2008-2009, the keyboard shipment was 5.3 million. The monitors market grew by five percent in 2009-2010 over the previous year, taking the shipment of monitors from 5.5 million units to 5.8 million units.

The market in India for computers and mobile PCs is increasingly being driven by consumers and small sized companies and is no longer dependent on large businesses for growth. As the education and awareness about the benefits of using IT increase, further adoption of computing and peripheral devices will happen.

October 2010 / www.egovonline.net / egov

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