Shipments into the Canadian client PC market in the third quarter of 2010 showed unit growth above forecast in multiple segments and saw the consumer dominance of PC shipments reach new levels, but IDC Canada says there are signs that consumer dominance may soon begin to wane.
According to IDC Canada, unit volume for Q3 was up 8.3 per cent over the same period one year ago and up 30 per cent over Q2 of 2010, with 1,927,865 units shipping in the quarter. Tim Brunt, senior analyst for personal computing with IDC Canada, said while the market is strong the Q3 bump can in part be attributed to a change in shipping method by most vendors. While air shipments have traditionally dominated, sea shipments grew from 30 per cent in Q2 to nearly 70 per cent in Q3.
With sea shipments taking substantially longer, vendors may have shipped greater volume to prepare for the busy holiday shopping season.
“Every manufacturer is fighting to cut costs as much as possible and shipping by sea is substantially cheaper, by $25 to $50 per unit depending on the form factor,” said Brunt. “Shipping by sea not only sees significant savings for the manufacturer’s bottom line, it could also help give them an advantage when they go to market, allowing them to offer special sales pricing and promotions.”
Portable shipments were above forecast in Q3, growing five per cent year over year for 1,294,997 units. Desktops also performed well, up 16.5 per cent over the year ago shipping 632,868 units. Ultraportables and tablets are starting to show some strength, with manufacturers beginning to ship Windows 7 devices. While still low in overall numbers, tablet sales did grow by 356.1 per cent, year over year.
Brunt said average selling price was a surprise in Q3, increasing by 15.9 per cent, year over year. One factor was the continued decline in shipments of low priced netbooks, which were down by 34 per cent from the same period last year.
Instead, consumers are turning to other form factors with higher selling prices. All in one shipments grew in the quarter to now represent 20 per cent of all desktop shipments and 35.5 per cent of consumer desktop sales. An increase in market share by Apple, with its on average higher prices, also helped boost the average selling price for Q3.
“Apple had a fantastic quarter in market share growth, and a bit of a more selective buying experience for the consumer really drove-up selling values,” said Brunt.
Apple grew its market share from 8.9 per cent a year ago to 10.8 per cent in Q3 of 2010, good enough for fourth on the vendor leader board, an impressive showing giving its smaller product line-up.
Hewlett-Packard Co. built on its lead in Q3 however, gaining four per cent for overall 27.6 per cent market share, ahead of Acer at 18.7 per cent and Dell at 14.7 per cent. HP led in desktops with 28.8 per cent share and in portables with 27.1 per cent of shipments.
“HP has across the board growth,” said Brunt. “They did some strong retail numbers, but there wasn’t one particular area where they surged.”
The consumer dominance of the Canadian PC market reached new levels this quarter, representing almost 59 per cent of the overall market.
It’s been a substantial shift over the last decade, with the consumer space only accounting for 40 per cent of the overall market in Q3 of 2000. A number of factors can explain the growth, such as declining prices, the growth of the portable market and a challenging economic climate for the enterprise market.
Brunt said the consumer market has really been the force in Canada over the last few years, steadily growing its footprint over the enterprise market and passing it for market share in 2008.
“In Q3 we saw huge amounts of units coming into the market for the consumer space, but the question is how long you can expect that to continue,” said Brunt. “It can only go on for so long before we reach as many people as we can. I think we’re seeing the consumer market at its pinnacle right now, and it’s going to start to decline a bit.”
While sales of new form factors such as media tablets will sustain consumer sales through the next few quarters, Brunt said he expects the enterprise market will recover into 2011/12 and return to traditional levels versus the consumer space.
Follow Jeff Jedras on Twitter: @JeffJedrasCDN.