Retail and Mail-Order PC Sales Decline 24% in Dec.
Personal computer unit sales in the retail and mail-order market declined by about 24% in December from a year ago--the largest year-to-year decline ever--according to preliminary results released Wednesday by research firm PC Data.
“It looks like the market is hitting the reset button on the PC market,” PC Data analyst Roger Lanctot said. “They have to get to a lower price point or a different configuration or something, because what they are doing now is not working.”
The December report of sales in the retail and mail-order market--about one-third of the overall personal computer market--was the fifth in a row that showed a year-over-year decline.
A 7% drop in the average price of a PC to $846, from a year ago, wasn’t enough to boost sales.
“In August we had the first negative comparison of monthly sales,” Lanctot said. “And thedeclines have grown progressively greater each month after that.”
The survey didn’t include data on direct sales from computer manufacturers; for example, online sales by Dell Computer Corp. are not included.
For the full year, sales of PCs in the retail and mail-order group were down 0.8% from 1999 to 10.1 million units, the first annual decline ever reported by PC Data.
“A spike occurred during the week before Christmas, but it fell short of the boost needed to lift overall sales during the holiday shopping season,” said PC Data analyst Stephen Baker.
He cited the success of Internet service provider rebate programs in 1999, a slowing economic outlook, slightly higher prices in 2000 and lack of compelling reasons to upgrade PCs purchased in the last two years as reasons for the decline.
Consumers shifted their fourth-quarter buying from PCs to digital items such as hand-held organizers, Web cameras and digital music devices, Baker said.
Increased sales of non-PC products means revenue at computer retailers should be up 10% to 12% in the fourth quarter, PC Data said.
U.S. sales of hand-held organizers more than doubled in November from the same month last year, while sales of MP3 digital audio players increased fivefold, Web PC cameras increased 68% and CD recorders increased 65%.
