PC Sales to Grow, But Slower in 2006

Despite the fact that fewer consumers will be replacing their computers in 2006 and lagging economic growth, the overall PC market is expected to continue to grow, albeit at a slower pace. The industry is expected to expand by 10.5 percent in 2006, which would be down from 15.8 percent this year.

Low cost and portable PCs will lead growth in the sector, research firm IDC said in its Worldwide Quarterly PC Tracker report Tuesday. In the current quarter, IDC now expects shipments to grow about 15 percent, up from earlier expectations of 12.6 percent growth.

With these updated projections, 2006 would become the fourth consecutive year of double-digit growth, although just barely.

IDC said that even with the impact of hurricanes Katrina, Rita, and Wilma coupled with rising fuel costs, the outlook in the United States remains strong due to a healthy business market and demand for laptop computers.

"The fact that solid double-digit growth has continued through 2005 shows that the market recovery did not peak in 2004 as many expected but is still ongoing," IDC's director of the Worldwide Quarterly PC Tracker Loren Loverde said.

Regionally, the survey shows some interesting trends in computer buying by consumers. In the US, portable devices are expected to become a driving force in the market, compromising half of all shipments by 2008.

However, across Western Europe IDC expects shipments to decline due to a softening of regional economies and less consumers in the region upgrading to newer machines.

In Japan and across Asia, demand remains strong; however, the firm said it remained cautious in the Japanese market due to already high penetration of notebook computers.

The Worldwide Quarterly PC Tracker looks at data in 55 countries across a variety of metrics, including vendor, processor brand and form factor.