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Monday, May 29, 2000, updated at 08:38(GMT+8)

Chinese Consumers Snatch Desktop Computers

Sale of desk-top PC in China grew strongly during the first quarter, the International Data Corp (IDC) revealed in its quarterly report.

Total sales of consumer desktop PCs reached 418,061 units with a value of US$435.1 million. This amounts to a 10.9 per cent increase in growth when compared to the 377,116 units sold during the previous quarter.

"Surgin dotcom companies fuelled the growth,'' said John Zhuang, a market analyst with the IDC.

"The new trend now is Internet surfing and PCs are a necessary bridge for most of us,'' he said.

Related telecommunications bureau also cut service charges to encourage more Internet users although fees are still relatively high. Many ISPs (Internet service provider) have launched package service plans containing less expensive usage fees.

The government recently launched plans to encourage "quality education.'' Under the plans, students have less homework and more time to play. They are expected to turn to computers during their spare time.

The other reason may be that year 2000 is the "on-line government year.'' Government bureau and enterprises are changing from conventional forms to e-forms. Group consumption was very active during the period, according to Zhuang.

Notebook PCs ranked No 2 after desktop PCs on the list which registered a 8.1 per cent growth with total sales of 93,414 units.

Zhuang said growth was encouraged by price cutting. The prices of notebook PCs have dropped from over 20,000 yuan (US$2,415.46) last year to around 13,000 yuan (US$1,570.05) in March.

Domestic brands still control a major market share. Legend is far ahead of others with a 26.2 per cent market share. But 360,614 units sold was a 2.2 per cent drop from the fourth quarter of last year.

Although Legend reported a 107.2 per cent growth rate on a yearly bases, its market share shrank slightly from 27.3 per cent of the previous quarter to this quarter's 26.2 per cent.

"Legend is facing tougher competition,'' Zhuang said, "Many conventional home appliance producers are trying to get a slice of the PC market.''

Domestic appliance giants Haier, TCL and Hisense are producing their own brandname PCs. TCL launched an Internet PC recently which is a strong competitor of the Legend Conet which was announced at the end of last year.

"The life cycle of a PC is only three months on average, customers get bored after that,'' he said.

International computer giants IBM and Hewlett-Packard are also included in the top five brands. But they lost business sovereignty with market share losses of 5.8 per cent and 32.7 per cent compared to the previous quarter.

Domestic brands Founder and Great Wall changed places with IBM and Hewlett-Packard and ranked No 2 and No 4.

IDC also forecasts that the Chinese PC market will grow moderately for the full year. The report predicted that total sales of PCs including desktop PCs, notebook PCs and PC servers will amount to 6,372,119 units compared with last year's 4,936,694.

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Sale of desk-top PC in China grew strongly during the first quarter, the International Data Corp (IDC) revealed in its quarterly report.

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