Asia-Pacific PC sales tumble 20% in Q1 '98

PC sales in the Asia-Pacific market were 20% lower by value in the first quarter of 1998 compared to the same period in 1997, market research company Dataquest has reported. The 20% drop in value represents lost sales of $US710 million, as lower unit sales were compounded by a falling average purchase price. While sales in China bucked the trend to rise 56%, the South Korean PC market was a disaster.

PC sales in the Asia-Pacific market were 20% lower by value in the first quarter of 1998 compared to the same period in 1997, market research company Dataquest has reported.

The 20% drop in value represents lost sales of $US710 million, as lower unit sales were compounded by a falling average purchase price, according to Bruce McCabe, senior industry analyst for Dataquest's Personal Computers Asia-Pacific program.

"The impact of the Asian economic crisis was even more dramatic than in preceding quarters as government IT spending cuts began to bite and buying patterns shifted to lower-cost systems," he said in a statement.

Full recovery of IT markets in the region is expected to take at least two years, according to Dataquest.

In the first quarter of 1998, the 10 largest Asia-Pacific countries by PC sales posted revenues of $2.8 billion in the first quarter of 1998, compared to 1997's first quarter figure of $3.5 billion.

China continued to post the strongest performance, with first quarter PC shipments up 56% and revenue up 21%on last year, according to Dataquest figures. Australia, which the market research company estimates to be Asia-Pacific's biggest PC market, saw an increase in the number of systems sold, but a slight drop in revenue because of falling prices.

The South Korean PC market, Asia-Pacific's largest market in the first quarter last year, reported a precipitous revenue drop of 46%, and was largely responsible for the region's poor overall figures, Dataquest said.

Troubled Southeast Asian markets also saw steep declines in their sales, with Malaysia's PC revenues down 55%, Thailand's down 62%, and Indonesia's down 82%. Even relatively robust economies such as Taiwan and Hong Kong saw a reduction in PC revenues, Dataquest said.

The fastest growing vendors in the region were Legend Group -- China's leading domestic PC maker -- which continues to gain share in the booming Chinese market, Hewlett-Packard, and Dell Computer.

"Short supply chains have become a significant advantage in such a difficult and volatile environment, and are a major factor behind Dell's uninterrupted growth," said Dataquest's McCabe in a statement.

CHART: Asia/Pacific Personal Computer Revenue by Country in Q1 1998 (Millions of U.S. Dollars)

Country

Q1/97 Q1/98 Yr/Yr Change (percentage)

Australia 818 771 -6

China 589 715 21

Korea 828 445 -46

Taiwan 248 230 -7

Singapore 159 190 19

India 239 155 -35

Hong Kong 160 155 -3

Malaysia 181 81 -55

Thailand 151 57 -62

Indonesia 165 30 -82

Source: Dataquest Inc.

Dataquest, a unit of GartnerGroup Inc., can be contacted on the Web at http://www.dataquest.com/.

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