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Thursday, 25 October, 2001, 19:09 GMT 20:09 UK
Computer demand slumps again
Selection of personal and handheld computers
Demand for both personal and handheld computers has continued to slump during the three-month period from July to September.

Worldwide personal computer shipments fell 13.7% during the period, compared to the same three months a year earlier.

The downturn was especially bad in the USA, where shipments were down 21%, according to new figures released by research firm, IDC.

Meanwhile, the shipments of personal digital assistants (PDAs) in Western Europe fell by 34.5% between July and September, according to the latest figures from Dataquest, a unit of Gartner.

Waiting on Microsoft

Despite the slump in handhelds, the news was not all bad for Palm, which increased its European market share by 5.6%.

But Compaq'a rapid growth in the European PDA market stalled suddenly, as it saw a 13.3% decline in market share and shipment levels fell to less than half of those in the previous quarter.

"This decline had been expected, after the rapid slowdown during the first half of 2001," said Dataquest analyst Roberta Cozza.

Ms Cozza blamed the worsening economic outlook, but added that it also reflects the typical summer down trend.

And the imminent launch of Microsoft's pocket PC 2002 may have also slowed customer purchase of handhelds during the third quarter.

PC consolidation

Amongst the PC market, desktop computers were the most affected due to the cautious business climate.

"The harsh economic climate and ensuing budget restrictions continued to affect corporate spending on portable PCs," said Andy Brown, research manager for mobile computing at IDC.

IDC notes that, while the 11 September terrorist attacks had little impact on the PC market, it certainly contributed to exacerbate the already worsening economic situation.

And IDC expects the fierce competition and erosion of profit margins to lead to further consolidation in the PC industry.

Gateway has already pulled out of Europe, while Hewlett Packard and Compaq are to merge.

See also:

03 Oct 01 | Business
Racing to win the handheld prize
12 Jul 01 | Business
The battle of the handhelds
11 Jul 01 | Business
Psion pulls out of handheld market
10 Sep 01 | Business
Gateway shuts European headquarters
06 Sep 01 | Business
Tough sell for PC giants merger
25 Oct 01 | Business
PC makers hope for XP boost
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