Weak rand hurts local PC market

2016-06-06 12:30 - Duncan Alfreds, Fin24
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The PC market is facing declines. (Duncan Alfreds, Fin24)

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Cape Town – The declining rand has hit the growth of PCs in SA hard, says an international research organisation.

According to International Data Corporation (IDC), PC shipments dropped to 342 399 in the first three months of 2016, significantly below the 427 331 in the same period of 2015.

“The South African PC market declined considerably in quarter one of 2016. This expected decline was fuelled by the depreciating rand, high unemployment rate, high fuel, food and utility prices,” Teboho Leshage senior research analyst of Imaging Printing, Document Solutions and Handset at IDC told Fin24.

The South African data, though, also matched a 25.9% year-on-year decline in the Middle East and Africa region. According to the IDC, shipments in this region topped 3.2 million units for the period.

Notebooks declined 28.7% while desktops moved 21.4% lower.

Tablets on decline

READ: Short-term spike in SA feature phone sales

“The reasons differ from country to country, but slowdowns in tourist spending, lower consumer confidence resulting from low oil prices, political and economic instability, currency devaluations, and military conflicts have all played a part in the regional contraction,” said senior research manager Fouad Charakla, responsible for Personal Computing, Systems, and Infrastructure Solutions, in IDC Middle East, Africa, and Turkey.

IDC data showed that HP led the local PC market, followed by Lenovo and Dell.

“With end-users spending more time on using other devices such as mobile phones and tablets, the demand for PCs continues to shrink as PCs are seen as the third device of choice due to the high price component, especially at a time when end-users are experiencing financial constraints,” Leshage said.

Tablet shipments experienced a milder decline, dropping to 371 680 from 391 065, year on year.

Samsung took first place in SA, followed by Apple and Lenovo.

“Both desktop and notebook PC product categories recorded a decline, with notebooks experiencing a sharper decline. In addition, end-users are delaying their PC upgrades and projects and credit terms have also become more stringent as a result of the tough economic conditions and devaluation of the rand,” said Leshage.

The IDC said that it expects PCs to show some recovery in the longer term despite a consumer market shifting to mobile devices.

“In the longer term, the PC market is expected to recover to some extent in 2017, with modest growth anticipated in the following years,” said Charakla.


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