Covid-19 outbreak hits declining PC market

The deadly Coronavirus otherwise called Covid-19 has hit the PC market, sparking concern for a declining segment of the global technology industry.

Technology Industry analysts at International Data Corporation (IDC) say they are revising their forecast for the global PC market further downwards as several factories and manufacturing plants in China close temporarily due to the COVID-19 outbreak.

As Covid-19 outbreak spread across parts of the world, Nigerian disease control authorities weekend confirmed that a case of the deadly virus has been recorded in the country by an Italian who had just traveled into the country.

The closure of factories in China, a major tech supply hub for the global tech industry, expected to drive decline into next year, is yet another major blow to the declining PC device market.

Technology Times photo file shows the Nokia 105 mobile phone: IDC says that consumer preference for mobile devices are eating into the PC market.

Meanwhile, IDC, the global technology research and consulting firm's latest Quarterly PCD Tracker reveals that the PC market across Africa and the Middle East will face further decline not only because of COVID-19 outbreak.

IDC says that Covid-19 is just the latest hurdle facing the Middle East and Africa (MEA) personal computing devices (PCD) market, which is made up of desktops, notebooks, workstations, and tablets, that suffered a slight year-on-year decline in shipments during the final quarter of 2019.

The closure of factories in China, a major tech supply hub for the global tech industry, expected to drive decline into next year, is yet another major blow to the declining PC device market.

"Looking ahead, IDC expects PCD demand to continue declining slowly over the coming years," says IDC. "Commercial demand will remain relatively stable; however, home users will continue to shift away from computers and tablets to other technologies. However, for both Q1 2020 and the year overall, IDC has revised its forecast further downwards due to the COVID-19 outbreak, which has caused the temporary closure of several factories and manufacturing plants in China. As a result, supplies of various goods, including computers and tablets, will also most likely suffer. The decline in shipments for 2021 onwards is expected to be much softer."

IDC’s latest Quarterly PCD Tracker shows that a total of 5.5 million units were shipped across the region in Q4 2019, down 0.9% on Q4 2018.

"The biggest decline was seen in South Africa, where the country's overall economic performance was slow," says Fouad Charakla, IDC's senior research manager for client devices in the Middle East, Turkey, and Africa. "The business confidence index remained low, unemployment levels remained relatively high, and the rand's exchange rate against the U.S. dollar remained weak, altogether weakening PCD demand in the country and having a considerable negative impact on shipments.

"There was another huge decline in the UAE, where market sentiment remains on the weak side. This is having a negative impact on demand from both the commercial and consumer segments. And while the final quarter of the year saw shipments for the annual month-long 'Dubai Shopping Festival', which took place at the very start of 2020, demand continued to soften compared to the previous year."

A number of other countries suffered considerable declines in shipments, including Algeria, Pakistan, Nigeria, Morocco, Egypt, Lebanon, and the Rest of Middle East sub-region (which incorporates Iran, Iraq, Syria, Yemen, Afghanistan, and Palestine).

"On the flip side, Turkey experienced an astounding increase in shipments year on year, as the country continued to recover from the slowdown it suffered a year ago," says Charakla. "The growth in Turkey was almost big enough to mitigate the impact of the declines in all the countries mentioned above, which is why the region experienced only a soft decline overall. A massive delivery of over 500,000 Samsung tablets into Egypt's education sector also helped buoy the market."

In the PC segment, HP continued to lead by a significant margin, despite losing some share after suffering a year-on-year decline in shipments. Lenovo experienced strong growth to capture greater market share, while Dell also experienced some unit growth but still suffered a loss of share.

Middle East & Africa PC Market Vendor Shares – Q4 2018 vs. Q4 2019 Company Q4 2018 Q4 2019 HP Inc. 32.0% 29.1% Lenovo 21.0% 23.6% Dell 16.9% 16.6% Others 30.2% 30.7%

In the tablet space, Samsung remained in first place owing to the massive education deal the vendor delivered in Egypt. Apple and Lenovo ranked second and third, respectively.

Middle East & Africa Tablet Market Vendor Shares – Q4 2018 vs. Q4 2019 Company Q4 2018 Q4 2019 Samsung 37.9% 31.8% Apple 8.3% 9.8% Lenovo 5.6% 8.7% Others 48.1% 49.7%