Economic turbulence and the wait for Microsoft Corp.’s newest operating system caused many Latin American consumers and businesses to hold off on buying PCs in the third quarter, Gartner Inc.’s Dataquest unit said last Friday.

Consequently, PC shipments in Latin America fell 3.1 per cent to 1.8 million units compared with the same quarter last year, the first quarter in almost four years that the region’s PC market has failed to grow, said Luis Anavitarte, vice-president and research director for Dataquest Inc.’s Latin America group. PC purchases by businesses dropped two per cent in the third quarter, while consumer purchases fell six per cent.

A significant number of businesses that had planned to migrate from Windows 98 to Windows 2000 – migrations that often involve the purchase of new PCs – put those plans on hold as the October release of Microsoft’s latest operating system, Windows XP, approached, Anavitarte said.

“Many businesses who had thought about adopting Windows 2000 instead decided to wait so they can jump from Windows 98 directly to Windows XP, and that put the brakes on PC purchases,” he said, noting that most business PCs in the region currently run Windows 98.

Meanwhile, the arrival of Windows XP may in fact spur PC sales among consumers, but many are unwilling to spend on a new PC given the tough economic climate in Latin America right now, Anavitarte said. Latin American consumers are expected to embrace Windows XP for the new capabilities it brings, but the adoption will be slow, not a sudden burst, he added.

Consumers are also expected to become more willing to buy new PCs as a result of several government initiatives across the region aimed at fostering Internet use and lowering import tariffs for computer equipment, Anavitarte said, citing M