A New #1 in Town

The movement in PC sales, for long, has been the unofficial barometer of the
domestic IT market health. So, even as everyone rejoiced at IDC Indias
April-June numbersan increase of 34% y-o-y and a neat 5.8% growth
quarter-on-quarterit was not the best of news for the market leader, well, the
traditional market leader, Hewlett-Packard. Dell had beaten it by almost a
percentage point lead in market share in terms of number of units of
PCSdesktops and laptops combined.

This is the first time that Dell has occupied the #1 position in the Indian
PC market.

According to IDC India, the overall PC shipments beat seasonality to touch
23.7 lakh units in Apr-Jun 2010 quarter. While Dell emerged as the market leader
for the first time with a share of 15.2% , followed by HP with 14.3%, Acer,
despite its low profile, emerged as the #3 with 11.5% share.

Desktop PC sales accounted for nearly two-thirds of total PC sales at 15.6
lakh units, representing a 24% increase year-on-year. The sales of notebook
computers grew at 61% y-o-y recording 8.05 lakh shipments.

The consolation for HP, it continued to lead the desktop PC shipments with a
market share of 10.2%, followed by HCL and Acer in second and third spots
respectively during the quarter.

In terms of notebook PC shipments, Dell reclaimed the top spot with a market
share of 29.2 % in AMJ 2010; HP slipped back to second position, while Acer was
ranked at number three.

"The April-June quarter traditionally shows a small sequential dip in PC
sales. The sequential growth of 6 in overall India PC shipments in Q2 2010
points to the continuing economic revival," states Anirban Banerjee, associate
vice president, research, IDC India.

"An exciting product portfolio, strong channel support and an effective after
sales service network are becoming increasingly important to sustain growth in
this competitive market," says Sumanta Mukherjee, lead PC analyst, IDC India.

Sumanta added that the timely rollout of 3G services in the country would
influence the overall PC market fortunes in the first half of 2011, especially
in the mini-notebook PC and notebook PC segments.

The Victory March

While this is the first time that Dell has taken the top spot, those who
watch the company would not be surprised. Dell has been consistently snatching
away market share. It had taken the top spot in notebooks in the OND quarter,
but had conceded it to HP in JFM. But, with its channel strategy shaking off the
market, Dell is back with a lead that is good enough to give it the overall top
position.

IDC India releases only unit shipments. But considering that the average
selling price of Dell is higher than any other player, including HP, the market
share in revenue terms would be even higher.

According to DQ Top20 estimates, in FY10that is April 2009 to March
2010Dell held 25% market share in laptops as compared to 28% by HP. In
desktops, where Dell desktops are sometimes 50-60% higher than the competitors
products, Dell held 7% market share in FY10.

After Dell got aggressively into servers, storage and services, many critics
predicted that it would lose its focus on the PC market. But Dell has silenced
the critics by its show.

This has been long journey for a company which at one time was known as a
brand only for the large customers, especially in IT/BPO industry and whose
offshore call center got more media coverage than its sales in India. With
strong play across enterprises and governments already and getting aggressively
into SMBs with the channel play, Dell has a lot to show in the coming days.

While Dells success gets all the attention, there is yet another company
that is unsung but consistent: Acer. That is the company to watch.

A Dataquest report

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