Technology

U.S. PC Shipments Shrank in 2011 for First Time in a Decade


(Bloomberg) — The U.S. personal-computer market declined for the first time in a decade last year, hurt by sluggish consumer spending, supply shortages, and the popularity of smartphones and tablets.

Shipments slipped 4.9 percent to 71.3 million in 2011, the worst performance since 2001, research firm IDC said today. The U.S. market fell 6.7 percent in the fourth quarter, compared with a 0.2 percent drop for worldwide shipments. A separate report from Gartner Inc. pegged the fourth-quarter U.S. decline at 5.9 percent, with global shipments decreasing 1.4 percent.

Consumers and small businesses are holding off on orders while they ride out the sluggish economy, even as many corporate buyers stock up on PCs. Flood-ravaged disk-drive factories in Thailand also took a toll on the market, though component shortages resulting from the disaster will have a bigger impact in 2012, Gartner found.

“The culprit is the consumer,” David Daoud, an analyst at Framingham, Massachusetts-based IDC, said in an interview. “Consumers and small businesses are the ones that are struggling the most.”

Worldwide shipments declined to 92.7 million in the fourth quarter, from 92.9 million a year earlier, IDC said. Gartner put the number at 92.2 million, down from 93.5 million. In 2001, when the industry was suffering from a recession and the dot-com bust, U.S. PC shipments tumbled about 12 percent.

HP’s Lead

Hewlett-Packard Co., which decided in October to keep its PC business in house after exploring a potential spinoff, remained the industry’s top seller in the fourth quarter. Still, its global market share slipped to 16 percent from 18.8 percent, according to Gartner. Lenovo Group Ltd. ranked second with 14 percent, up from 11.3 percent. Dell Inc. was third with 12.6 percent, compared with 11.6 percent a year earlier.

In the U.S., Hewlett-Packard also ranked first, with 23.1 percent of the market, with Dell in second place at 22.4 percent, Gartner said. Apple Inc., which wasn’t even in the top five a year ago, saw shipments jump 20.7 percent. That put it in third place, Gartner found.

The first quarter isn’t likely to bring relief to the PC industry. Shipments in the period may decline by 5.1 percent, said IDC’s Daoud.

Ultrabook Effort

PC makers are counting on thin, lightweight laptops called ultrabooks — a term coined by Intel Corp. — to fuel growth this year. Hewlett-Packard and Dell both unveiled new ultrabooks at the Consumer Electronics Show in Las Vegas this week. All-in- one desktop PCs, which house their electronics behind the screen, also are seen as a bright spot for sales. The Windows 8 operating system will debut this year as well, giving shoppers another reason to buy.

Windows PC makers have suffered from the popularity of the iPad, which has sold more than 40 million units since its 2010 debut. Sales at Microsoft Corp.’s Windows unit, the operating system software that runs most PCs, have missed estimates in three of the past four quarters.

“The industry is obviously looking for ways to turn that around with new technology,” Daoud said.

With Dina Bass and Doug MacMillan
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Ricadela is a reporter for Bloomberg News and Bloomberg Businessweek in San Francisco.

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