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Saturday, Jul 06, 2002

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PC sales crash by 11% in 2001-02

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HIT by economic recession, personal computer (PC) sales in the country during 2001-02 fell by 11 per cent to 1.67 million units from 1.88 million units in the previous fiscal, according to a survey by MAIT (Manufacturers Association of Information Technology).

PC sales are slipping into the negative territory for the first time since MAIT started doing the survey in 1996-97. In 2001-02, sales of desktops had grown by 34 per cent.

However, MAIT expressed the hope that PC sales in the current financial year would grow by 12 per cent to touch 1.9 million units as signs of recovery were visible in the first quarter.

``Things have settled now and investments were starting to be made. The fundamentals are very much in place...'' said Mr S Devarajan, President, MAIT, at a press conference here to announce the survey, conducted by market research agency IMRB.

According to the MAIT-IMRB survey, assembled PCs, including the smaller, lesser known local brands, accounted for 46 per cent of the PC sales in 2001-02 as compared to 53 per cent in 2000-01.

``The poor performance reflects that fact that price sensitive market segments deferred their IT purchase plans in 2001-02,'' said Mr Vinnie Mehta, Executive Director of MAIT.

The biggest gainer during the year was multinational brands who improved their market share to 35 per cent from 27 per cent in the previous fiscal. The share of Indian brands, however, marginally declined to 19 per cent from 20 per cent a year ago.

The MAIT-IMRB survey revealed that PC sales to both business segment and households declined by 11 per cent during the year with the former accounting for 78 per cent of the market.

``Within businesses, the larger businesses (over 50 employees) and medium businesses (between 10 and 50 employees) witnessed sales fall by 10 per cent and 18 per cent respectively,'' the survey said, adding that sales to the small sector (less than 10 employees) also declined — by 18 per cent.

A major finding of the survey has been that there was increased consumption of IT products in smaller towns and cities during 2001-02.

As much as 30 per cent of total PC sales was accounted for by Class `B' and Class `C' cities, clocking a growth of 106 per cent from 13 per cent last year. Notebooks sales too grew by a staggering 200 per cent in these places.

In contrast to this, the share of the top four metros in buying PCs declined by 26 per cent to 56 per cent from 68 per cent in 2000-01. Similarly, PC purchase in the next four metros accounted for 14 per cent, a drop of 35 per cent.

In terms of processor configuration, the MAIT-IMRB survey found that PC sales in 2001-02 was dominated by Pentium III 550 MHz with a market share of 46 per cent. P4 accounted for 24 per cent.

The survey said the number of active Internet entities increased to 1.29 million in March 2002, registering an increase of 15 per cent over the corresponding year. The penetration of Internet among businesses grew to 39 per cent from earlier 36 per cent, while 11 per cent households had net connection.

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