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TrendForce: 5.4% PC Growth Forecasted for 2012, Ultrabook Market Share to Hit 10%

23 February 2012 Consumer Electronics

According to DRAMeXchange, a research division of TrendForce, suffering from the traditionally weak first quarter and the HDD supply shortage that will not see full recovery until the end of this quarter, 1Q PC shipments fell by 5.3% QoQ. Affected by the decreased number of business days due to Chinese New Year as well as the HDD shortage, January PC shipment volume was approximately 22 million units, a monthly decrease of 11.4%. After February, with the continual HDD recovery and the unveiling of Intel’s new Ivy Bridge platform, shipment volume should gradually increase. Therefore, 2Q shipment growth is forecasted at 10.8% QoQ. From the market perspective, ultrabooks and Windows 8 are expected to provide momentum for PC growth this year. With the back-to-school effect in June, the holiday season in the second half of the year, and the potential wave of commercial upgrades in 2H12 (commercial upgrades have not occurred on a large scale since the financial crisis in 2008), PC growth is forecasted at 5.4% for 2012.

Rise of Affordable Ultrabooks to Provide Main PC Growth Momentum in 2012
Intel introduced the Ultrabook concept at Computex in June 2011, introducing consumers to a new computing experience with thinner, lighter form factor, longer use times, and faster boot and connection features (AOAC - Always On, Always Connected). In 4Q11, ASUS, Acer, Lenovo, and Toshiba all introduced new ultrabook products, but all price tags exceeded US$1000. In comparison to standard notebooks’ average retail price of US$680, not to mention Apple’s similarly priced Macbook Air, the new ultrabook models were unable to attract consumers; ultrabook market share was a mere 2% in 2011.

As Intel’s management of the supply chain enables cost reduction in 2012, ultrabook retail price will likely be driven down below US$800, or even US$700. New models will continue to hit the market in 2H12, which should stimulate purchases. Looking at price, standard notebook ASP is around US$650 in 2012; thus, ultrabook price needs to dip below US$700, as a US$50 price gap would be acceptable to consumers. At such a price point, the new models would be approximately US$300 cheaper than the most basic MacBook Air model, which would attract price-guided consumers, as system performance is similar. Therefore, TrendForce expects the PC market will benefit, and the notebook shipment 1H:2H ratio is estimated at 45:55. Ultrabook shipment volume is forecasted at 20 million units, a significant increase from last year. As for 2013, 55 million ultrabook shipments are projected, putting market share at 25%. Hopefully, ultrabooks will be able to take over for standard notebooks and provide support for PC market growth.

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