Canadian PC sales down, says IDC Canada

While consumer demand is typically depressed following the holiday buying season, the lack of demand by Canadian consumers was particularly unsettling in the first quarter of this year IT industry analyst IDC Canada reported this week. When compared to last year’s weak quarter shipments of consumer branded PCs actually declined, the first time consumer demand for PCs has ever receded, IDC Canada reported.

On a positive front, commercial PC demand outpaced expectations, led by strong growth in standard Intel architecture servers and desktop PCs. According to preliminary estimates released by IDC Canada, overall Canadian PC unit shipments in the first quarter of 2001 increased eight per cent over last year to reach 866,100 units.

John Stanisic, hardware research analyst at IDC Canada, said Canadian businesses are cautiously returning to normal PC spending patterns as they begin the process of refreshing PCs bought in preparation for Y2K. On the other hand, Stanisic said, consumer demand is constrained as both PC vendors and PC component suppliers are still searching for the next “killer app” that will spur PC demand.

IDC reported that the build-out of Internet infrastructure is driving current demand for standard Intel architecture servers, with Canadian shipments growing a robust 25.7 per cent in this year’s first quarter over last year. The overall Canadian desktop PC market grew 8.9 per cent this quarter from last year’s, fueled by renewed commercial buying. Notebook sales remained relatively flat, registering a two per cent annual growth rate.

After the busy consumer-buying holiday season, the first quarter saw many leading suppliers redouble their efforts in the commercial market, IDC Canada said. Pricing pressures were apparent in the first quarter, as leading vendors took aggressive price actions in order to gain share and reduce inventory. Particular effort was paid to public sector sales, as the major vendors strove to “cash in” on the peak government PC purchasing period, IDC reported.

In a show of stability not recently seen in the Canadian PC market, Dell managed not only to maintain its number one ranking in the overall Canadian PC market, but also increase its share of the market to 18.9 per cent, placing more distance between itself and competitors, reported IDC. A broad product line coupled with aggressive pricing enabled Dell to grow its unit shipments year-over year by a blistering 47.1 per cent, IDC said. Shipments of standard Intel architecture servers also grew dramatically, as Dell was able to translate its strength in the commercial desktop and notebook markets into more corporate “wins” in the server space, IDC added.

Compaq maintained its second place ranking in the overall Canadian PC market with 14.5 per cent of the market, reported IDC. A keen focus on the commercial sector allowed Compaq to experience a healthy annual unit shipment growth of 27.9 per cent, said IDC. Compaq enjoyed resurgence in the standard Intel architecture server market, as strong annual growth enabled it to grow its market share in this segment, IDC said.

Despite a decline from last year in its shipments of notebooks and standard Intel architecture servers, IBM managed to retain its third place ranking in the overall Canadian PC market with a 13.2 per cent share, reported IDC. IBM continues to leverage its brand image as a total solutions provider, IDC said.

Of all the leading Canadian PC vendors, Hewlett-Packard felt the greatest chill from the slowdown in consumer PC buying. Despite a decline of 14.5 per cent from last year in terms of unit shipments, HP managed to maintain its fourth place ranking in the overall Canadian PC market with a seven per cent market share, IDC reported. Offsetting the consumer softness, HP experienced healthy year-over-year growth in its commercial PC offerings, IDC said.

Capturing fifth spot in the overall Canadian PC market with 3.8 per cent market share, a resurgent Toshiba also reclaimed the number one ranking in the Canadian notebook market in this quarter, IDC reported. Toshiba continues to face tough competition from notebook market rivals Dell and IBM, as all three vendors continue to battle it out for opportunities within the small business segment.

IDC Canada is based in Mississauga, Ont. and can be reached at

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