Computers selling well in region’s conflict zones

Computer shipments to the region’s conflict zones, including Syria, Iraq, Afghanistan and Iran, have grown the fastest, according to a report from the International Data Corporation (IDC).

The Middle East’s most unstable zones have helped to halt seven successive quarters of year-on-year decline in PC sales. Sales in the second quarter rose 2.2 per cent to 4.5 million units, which included both desktop and portable PC products across the Middle East and Africa.

The growth is attributable to the already low penetration rates in those countries where PC makers such as Hewlett-Packard (HP) and Lenovo have no official outlets, but instead rely on distributors and second and third-tier resellers.

“Penetration in these areas is very low,” said Rajat Rallan, the senior merchandising manager for Dell Middle East and North Africa, which has the third largest market share in the region. “But we have to wait and watch how the political situation opens up in that region.”

The increased instability, however, does not bode well for further growth.

“We have recently witnessed increased levels of instability, particularly in Iraq, and demand is now forecast to slow down slightly as a result, although we don’t expect these developments to prevent overall growth for 2014,” said Fouad Rafiq Charakla, the research manager for personal computing, systems, and infrastructure solutions at IDC Middle East, Turkey, and Africa.

IDC is predicting a decline of up to “double digits” for the next quarter given the conflicts affecting Iraq, Syria and the Palestinian Territories as consumers lose appetite for big purchases.

“It all depends on the conflict itself,” said Mr Charakla. “If sanctions are removed in Iran, the market will grow even faster. If the invasions in Iraq and the violence taking place halts, then demand in the market will grow faster, there are wealthy people who can afford laptops.”

The region’s consumer market accounts for 55 per cent of overall PC sales. US-based HP maintains the highest market share in the region, posting a year-on-year growth of 26 per cent. China’s Lenovo is in second place for PC shipments in the region, despite growing 71 per cent year on year.

Bucking global trends, the desktop market grew slightly faster than portable devices, although Mr Charakla expects this to change.

“Consumer demand for desktops will diminish, but looking at the commercial side we are seeing quite a few segments still loyal to desktops,” he said. “It depends on the sectors. Some will change extremely slowly like banking or government organisations, they will remain more loyal to desktops for security purposes.”

Overall, the region’s sales are expected to grow for the full year, with events such as Gitex Shopper boosting sales.

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