Drop in Japan PC Sales May Spell Trouble for Industry - AP

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 |  Includes: AAPL, DELL, GTW, HPQ, IBM
by: SA Eli Hoffmann

The role of the PC is shrinking in Japanese homes, as consumers increasingly turn to gadgets like smart-phones, pocket PCs, game consoles, and connected DVD recorders, AP reports. Slippage in Japan's PC market has analysts wondering this could be a warning of diminishing PC sales worldwide. "The household PC market is losing momentum to other electronics like flat-panel TVs and mobile phones," said IDC's Masahiro Katayama. PC shipments in Japan have dropped in each of the last five quarters, the first-ever extended decline in a key market, according to IDC. In Q2 2007, desktop sales were down 4.8% while laptops fell 3.1%. "In Japan, kids now grow up using mobile phones, not PCs. The future of PCs isn't bright," Katayama said. More than half of all Japanese use their mobile phones for email and web browsing, and Japan's fastest-growing social-networking site, Mobagay Town, is cell-phone exclusive. PC makers cite figures saying outside of Japan, PC shipments are expected to rise 11% in 2007, buoyed by booming emerging-market demand. Sub-$300 laptops released for the coming holiday season will also boost sales, they say. Hiroyuki Ishii, a sales official at Japan's top PC maker, NEC Corp., admits PCs are loosing favor in Japanese consumers' eyes. "The PC's value will fade unless the PC can offer some breakthrough functions," he said.

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