Gartner: PCs On The Rise...For Now

By Gabriel Perna: Subscribe to Gabriel's RSS feed

August 31, 2010 8:58 PM EDT

The PC industry is not dead yet, according to industry research firm Gartner.

The report from Gartner says worldwide PC shipments will total 367.8 million units in 2010, which represents a 19.2 percent increase from 308.3 million units shipped in 2009. However despite the positive news for the PC industry, the Gartner report says most of the growth happened in the first half of the year. The real test will come in the second half.

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"The PC market revived in the first half of 2010, but the real test of its resilience is yet to come. We have reduced our forecast for second-half 2010 PC growth to 15.3 percent, approximately 2 percent below our previous forecast, in light of the uncertain economic outlook for the United States and Western Europe. There is no doubt that consumer, if not business PC demand has slowed relative to expectations in mature markets," said Ranjit Atwal, research director at Gartner, in a statement.

A few things have saved the PC industry. Unlike up-and-coming electronic devices like the tablet computer, the PC is still seen as a necessity, not a luxury. The report also says businesses that decided to forgo upgrading their PCs in 2009 due to the economic downturn will eventually have to replace their old machines.

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"Businesses that delay replacing much longer risk alienating employees, burdening themselves with more service requests and support costs, and ultimately facing higher migration costs when they eventually migrate to Windows 7," Atwal said. "The bottom line is that businesses need to refresh their PCs sooner rather than later."

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Small netbooks, often perceived by industry analysts as a serious threat to the future of the PC, are not as big of a risk to the future of the traditional PC industry as they once were, according to the report. Shipments of mini netbooks, also known as ultraportables, declined for the second consecutive quarter in the second quarter of 2010. After having a peak of 20 percent of the mobile PC market, mini netbooks are down to approximately 18 percent.

"We still think the mini-notebook has a place in the mobile PC market, but not as a substitute for a standard mobile PC. Indeed, the recent decline in mini-notebooks' share of the mobile PC market reflects a general realization among buyers that mini-notebooks are less-than-perfect substitutes for standard low-end laptops," Raphael Vasquez, research analyst at Gartner, said.

Meanwhile, Gartner said tablet computers are a growing threat to the aforementioned mini-notebook industry. The touch screen device with a five inch or larger screen has been thrust into the limelight with the emergence of the Apple iPad. However, Gartner analyst George Shiffler said it won't be the iPad that makes this device a mainstream competitor to the mini notebook industry.

"The iPad hasn't had much of an impact on mini-notebook units so far, if only because it is generally priced higher than most mini-notebooks. However, we anticipate lower-priced iPad imitations will begin to take larger bites out of mini-notebook units as they are released next year," Shiffler said.

This article is copyrighted by International Business Times, the business news leader