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PC market in UAE to fall by 10% in third quarter

Consumer demand will decline faster than commercial, analyst says

Gulf News

Dubai: The PC market in the UAE is expected to decrease around 10 per cent year on year in the third quarter of 2018 due to the cannibalisation of smartphones.

“The primary reason for this decline is the growing usage of smartphones, which continues to cannibalise demand for PCs. Additionally, a large scale education project — which was held during the third quarter of last year — was delivered during the second quarter of this year, resulting in fewer shipments for the third quarter,” said Fouad R. Charakla, senior research manager at International Data Corporation (IDC).

As per IDC stats, the third quarter shipments are expected to be 335,845 units compared to 372,974 a year ago.

Charakla said that Gitex will be a driver for PCs but it is not likely to be significant, as a result of overall slowdown of consumer demand due to value-added tax (VAT) and a lot of people are spending most of their time on smartphones.

He said that the consumer demand for PCs will decline faster than commercial in the third quarter. VAT has increased the cost for end users and they focus more on the priorities. “The disposable income has slightly reduced and cost of products has also gone up by 5 per cent,” Charakla said.

Ashish Panjabi, Chief Operating Officer (COO) of Jacky’s Business Solutions, said that the replacement cycle for laptops is still there and there are many laptops which are more than two years old.

On the Mac side, he said that there haven’t been any exciting improvements but on the Windows side, there has been a lot of innovations happening. “Windows 10 as an OS which is getting a lot better and moving across devices to devices are working a lot easier,” he said.

Mohammad Hilili, General Manager for Lenovo Gulf, Saudi Arabia and East Africa, said the market has increased seven per cent year on year in the second quarter but there was a decline of 17 per cent in the consumer space and an increase in the commercial space.

“The average selling price of PCs have increased and this is not due to VAT but due to higher laptop and gaming machines sold. The fall in consumer space is compensated by the higher selling price,” he said.

In the third quarter, Hilili expects the same trend to continue in the third quarter.

For the year, Charakla expects the market to decline by 7.6 per cent.

Meanwhile, he said the tablet segment is definitely decreasing quarter on quarter due to the cannibalisation from smartphones. In the third quarter, he said the UAE market is expected to witness a year-on-year fall of around 25 per cent to 230,517 units compared to 305,687 units a year ago.

“The significant portion of requirements for tablets is fading away and or satisfied either with a laptop or a smartphone. For the year, the tablet market is expected to decline by 23 per cent,” he said.

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