PC sales stay on course, Internet usage picks up in homes

Personal computer (PC) sales went up 36 per cent in the first half of 2005-06, close to last year’s first-half growth rate of 37 per ce...

Personal computer (PC) sales went up 36 per cent in the first half of 2005-06, close to last year’s first-half growth rate of 37 per cent. At 23.4 lakh units, the PC base is fast approaching twice last year’s figure of 17.1 lakh.

The numbers reflect strong corporate consumption and growing interest in PCs in smaller towns and cities, according to Manufacturers Association for Information Technology (MAIT).

Only 10,000 units of the under-Rs 10,000 PCs are being reported as sold during the period by MAIT, though the Internet has emerged as a new engine for growth in the PC industry as per its latest survey.

Some 42 per cent of active Internet connections are held by businesses, but households have grabbed a larger share, 58 per cent, according to MAIT’s industry performance review.

The new expectation is that 2005-06 will close with 47 lakh total PCs units across categories will be sold, instead of the lower projection of 42.5 lakh units made earlier.

Notebook sales contributed in a big way to the H1 sales, growing 94 per cent compared to last year. Notebook sales totalled 16,000 units and are now making up 13 per cent of the PC market. Notebooks are now a Rs 748-crore business, finding their way into homes from the business segment, according to MAIT.

The business sgement, which accounted for 27 per cent sales growth last year, now improved by 55 per cent, making up 78 per cent of the PC market. This segment was 69 per cent of the total market in H1 2004-05.

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‘‘Home PC sales grew 5 per cent slower than last year, touching 5.1 lakh units,’’ said Vinnie Mehta, Executive Director, MAIT. ‘‘Assembled PCs occupied 34 per cent in H1 from 39 per cent in the preceding H1 due to aggressive pricing and better reach of branded players,’’ he said.

Indian brands grew their share to 31 per cent, while MNC brands accounted for 35 per cent of the PC market. Pentium’s P-IV processor dominated the shipments with an 81 per cent market share followed by P-IIIs, which held a two per cent share until September 2005. Cyrix and Celeron have a 17 per cent share, 27 per cent of it in the household segment.

Internet growth was a boost for the PC market over 2005, as active connections touched 31.7 lakh, up from 29.2 lakh in March last year.

‘‘Buoyancy in the first half can be attributed to high corporate consumption, robust sales in small towns and launch of sub-Rs 10,000 PC,’’ Vinnie Mehta, Executive Director, MAIT said.