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ShareNew Delhi: Computer sales dropped for the first time ever in FY08-09 as global slowdown eroded the large and medium enterprises' IT budgets, forcing them to cut back spend on notebooks.
The total computer sales fell 7% to 6.79 million units in the fiscal ended March 2009 as companies' dwindling IT budgets coupled with conservative approach in the home segment in the second-half of the fiscal severely impacted shipments, according to the annual report by Manufacturers' Association for Information Technology (MAIT).
"I think large enterprises shifted to desktop PCs instead of notebooks, which really hurt the shipments. If you see other sectors like government, education, small and medium business enterprises, telecom and banking, they were all in green," Vinnie Mehta, executive director, MAIT, said.
He said consumer sentiment was subdued due to uncertainty in the economy in 2008-09, which impacted the IT consumption in the country.
"While consumption in the first-half of the fiscal was satisfactory, less-than-expected offtake in sales in the second-half pulled down the overall growth into the negative quadrant," Mehta said.
MAIT was earlier expecting flat growth in desktops, notebooks and printers for this fiscal.
Sales of desktop computers declined 4% to 5.27 million units, while the promising notebooks crashed 17% to 1.51 million units.
However, the official suggested that PC shipment market has already revived with overall positive growth in the first quarter of the new fiscal.
"We have bottomed out in the PC market at least; in the past 4 months all sectors have shown the signs of revival. We are expecting growth outlook of 7% in this fiscal with increased spending from the government and enterprises. Meanwhile, the emergence of a new product category, the netbook, took the fancy of the consumers and I expect it grow faster than other form factors as it is better insulated from the prevailing market sentiments," Mehta said.
Verticals such as BPO/IT-enabled services, manufacturing, retail and households, which traditionally account for significant proportion of the IT market, were very conservative in their IT spends in 2008-09.
The last fiscal also witnessed deviations from the traditional downward trend in pricing for IT products as the dollar continued to be significantly strong compared to the rupee.
The large and medium enterprises accounted for 66% of the desktop sales, registering a growth of 5%. However, notebook sales in the segment crashed 27%.
Notebooks declined by 3% in the household segment in the same period. The decline in notebook sales in the second-half of was severe as sales fell 35% compared to the same period last year.
MAIT said internet subscriptions rose to 8.6 million as on March 2009, from 7.2 million a year ago, while the number of
internet users exceeded 60 million.
Slowdown bug
Sales of desktop computers declined 4% to 5.27 million units, while the promising notebooks crashed 17% to 1.51 million units
The large and medium enterprises accounted for 66% of the desktop sales, registering a growth of 5%
Verticals such as BPO/IT-enabled services, manufacturing, retail and households were very conservative in their IT spends in 2008-09
