Millions of people worldwide received a computer for Christmas, but by 1998's festivities, 1997's presents could be almost as obsolete as Charles Babbage's counting machine.

That's the verdict of research carried out by Livingston Rental, a London firm specialising in leasing PCs to businesses across Europe.

It says that as the time difference between new chip releases by Intel drops, so does the useful life of the machines it rents to companies.

In 1995 when the Intel 486 was top of the range, a machine's rental life was 17 months. In 1996 when PCs were running a 133 MHz Pentium chip, they lasted 11 months. By 1997 its clients only wanted to keep PCs with 166 MHz Pentium chips for 11 months, before replacing them with machines running at 200 MHz.

This could be next year's antique

Barry Watts, Livingston's business development manager, refused to accept that PCs were becoming obsolete, but admitted: "Products' success utilisation period is becoming shorter."

His company will carry out another two detailed surveys over the next few months.

There is little that companies can do to get round the problem either. They need to keep their machines up to date so they can run the latest and most performance-hungry applications, but they cannot simply replace the old chip with a new one.

Barry Watts says frequently the systems' architecture around a new chip is different to that in existing machines. The result is it becomes cheaper to buy a new machine.

He believes computers are being piled up in warehouses. "There are only so many computers you can sell off. Many companies have to stockpile them because they still have a financial interest in them."

The accelerating spiral is beginning to worry the retail trade. Fred Round, the Chief Executive of Britain's Radio, Electrical and Television Retailers' Association believes that "renting will soon be essential to a big dealer's survival."

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