Gartner India says that the system builder market declined from 3.06
million units in 2011 to 2.33 million units in 2012. While Gartner does
not track the individual components which are used to build a PC, Vishal
Tripathi, Principal Analyst, Gartner India estimates that the PC
building block market has seen a similar decline in growth rates.
The projections for the assembled PC market for 2013 are around 2 million units. With an estimated upgrade market of around 15 percent, the component market is estimated to be around the size of 2.3 million assembled PCs. Experts put the total size of the component market at Rs 4,600-5,500 crore.
“In terms of absolute numbers, the market still offers ample opportunities for thousands of resellers,” says Tripathi. “However, the overall size of the market has shrunk by 40-60 percent over the past 3-4 years.”
Microprocessors
The major hope for a revival of the desktop market is the launch of Intel’s fourth-generation Core i architecture code-named Haswell which is expected to be launched in June this year.
“We
are committed to ensuring that the system builder market stays alive.
We are also rallying behind OEMs to make technology available faster to
our partners”
B Suryanarayanan, Director, Sales & Marketing, Intel, South Asia
Intel is driving its white-box PC system builder market ecosystem to
focus on two markets, the ultra compact form factor and the PC-like
embedded market. For the former space the chip major has announced a new
form factor called Next Unit of Computing, and has started shipping the
product to partners. “We are committed to ensuring that the system
builder market stays alive and thriving. We are also investing in
ensuring that new exciting form factors are developed, and are rallying
behind OEM suppliers to make technology available faster to our
partners,” says B Suryanarayanan, Director, Sales & Marketing,
Intel, South Asia. “Apart from small form factors, we are urging
channels to look into opportunities in areas such as digital signage,
surveillance, PoS and gaming where growth is forecast for white-box
PCs.”
Disk drives
The disk drive shortage following the floods in Thailand has been blamed for half the issues in the component market. “I believe that the component markets would not have taken such a beating if drive prices had not gone up. OEMs managed to get supplies at the right prices while assemblers had to pay heavy prices for getting stocks,” points out Sampath Kumar MP, CEO, Positive Systems, Kochi.
IHS iSuppli has predicted a decline of 11.8 percent in HDD revenue to $32.7 billion worldwide in 2013 compared to 2012. It further states that the HDD revenue will remain flat in 2014 at $32 billion.
“Component
markets would not have taken a beating if drive prices had not gone up.
While OEMs got supplies at right prices, assemblers had to pay heavily”
Sampath Kumar MP, CEO, Positive Systems
The best hope for the disk drive market is the expected demand for SSD
drives as SSD prices drop further. “Many customers would prefer to
upgrade their drives to SSD which would ensure that their PCs or
notebooks run much faster, hence we are urging our channels to sell SSDs
as an upgrade option,” says MA Mannan, Country Manager, Corsair Memory,
India & Saarc.
IHS iSuppli predicts that the average selling price of hard drives will decrease by 7 percent in 2013. At the same time it expect SSD prices to fall by over 60 percent through the year.
Both Seagate and Western Digital have been shipping hybrid drives which use a small capacity SSD for either caching or storing critical data such as the operating system and traditional spinning disks to create larger capacities. While these drives are typically 40-100 percent more expensive than traditional drives, the performance is almost comparable with low-end SSD drives.
Motherboards
“The
explosion of digital content is driving the need for storage and flash
memory irrespective of whether a person is using a mobile, tablet or
notebook”
Manisha Sood, Country Manager, Sandisk India
The biggest news last year was Intel’s announcement of its plans to quit
the desktop motherboard market by 2016; this has given hope to many
motherboard makers. “Intel dropping out of the motherboard business will
help us to grab a bigger share of the market. Going forward we aim to
increase our motherboard marketshare from the present 23 percent to 30
percent by 2013-end,” informs Vinay Shetty, Country Manager, Component
Business, Asus India.
In H22013, the big bet is a transition to the new LGA1150 socket as Haswell processors hit the market. Many partners also expect Intel to cut its production of previous-generation processors to ramp up volumes and accelerate the transition to the new processors by year-end; this would get the motherboard upgrade market moving.
Some motherboard vendors are optimistic. Says Rajan Sharma, VP, Sales, Motherboard, Digilite, “We are expecting above-average growth in FY2013-14 if the corporate and SMB segment turn around. Increasing focus on small form factor PCs and penetration into Class B- & C cities will drive the segment.”
Graphics cards
According to AMD India, the independent graphics card market is hovering between 1,50,000 to 2,00,000 units, and growing. Says Vikas Gupta, MD, Technology & Gadgets, a Mumbai-based authorized distributor of AMD and Nvidia graphics cards, “We have witnessed a 50 percent increase in our sales compared to early 2012. We used to sell 5,000 units per month, but now, for the last five months, we are selling 7,500 units. The demand is more because of the enriched content from social media sites, YouTube and movie watching, as well as professional use by design and animation studios.”
Adds Rajesh Gupta, Country Manager, India, Zotac, “The demand for professional graphics cards is quite high because India is slowly emerging as a destination for creative outsourcing services.”
Memory
According to IDC, after an increase of 21.4 percent in 2012, the average growth of DRAM content per PC is expected to decline to a record low of 17.4 percent in 2013.
Opportunities in the memory market will be limited to opportunistic players because prices are expected to keep fluctuating. “We do not expect any major transition to happen in the next few quarters as it will be DDR3 only. Opportunities for upgrades remain good, with costs being low especially for notebooks,” says Piyush Pandey, Marketing Manager, Strontium India.
Removable storage
The removable storage market is expected to be healthy. “The explosion of digital content is driving the need for more storage and flash memory irrespective of whether a person is using a mobile, tablet or notebook. We see new technologies such as 3-bit-per-cell (X3) also improving the overall reliability of the solution,” says Manisha Sood, Country Manager, SanDisk India.
“As
the market matures there will be opportunities in gaming PCs,
workstations and other embedded devices. System builders need to find
their niche in these areas”
Sushmita Das, Country Manager, Kobian India
With USB 3.0 slowly becoming a standard option in newer motherboards,
PCs and notebooks, Sood expects many users to scrap older USB 2.0 drives
and buy new USB 3.0 drives.
ODDs
With a shift toward smaller form factors and with the proliferation of Internet broadband, the optical drive market is declining rapidly. The average prices of DVD writers fell to less than Rs 1,000 last year. While further price drops are not expected, channels do not see demand for optical drives as a standard option with PCs. With the faster USB 3.0 media being preferred even for installation of software, the days of optical drives are numbered.
Outlook
While the assembled desktop market which fuels the building blocks segment has declined rapidly over the past two years, most vendors are optimistic that the decline will be arrested, and that the next two years may see a flat market, which seems to be the best news for them.
“Growth will be flat, but the market size will remain stable for the next two years, following which the size may reduce with the changes in technology. However, as the market matures, there will be significant opportunities for assemblers in gaming PCs, workstations and other embedded devices. System builders will need to find their niche to leverage these opportunities,” says Sushmita Das, Country Manager, Kobian India.
The projections for the assembled PC market for 2013 are around 2 million units. With an estimated upgrade market of around 15 percent, the component market is estimated to be around the size of 2.3 million assembled PCs. Experts put the total size of the component market at Rs 4,600-5,500 crore.
“In terms of absolute numbers, the market still offers ample opportunities for thousands of resellers,” says Tripathi. “However, the overall size of the market has shrunk by 40-60 percent over the past 3-4 years.”
Microprocessors
The major hope for a revival of the desktop market is the launch of Intel’s fourth-generation Core i architecture code-named Haswell which is expected to be launched in June this year.
“We
are committed to ensuring that the system builder market stays alive.
We are also rallying behind OEMs to make technology available faster to
our partners”B Suryanarayanan, Director, Sales & Marketing, Intel, South Asia
Disk drives
The disk drive shortage following the floods in Thailand has been blamed for half the issues in the component market. “I believe that the component markets would not have taken such a beating if drive prices had not gone up. OEMs managed to get supplies at the right prices while assemblers had to pay heavy prices for getting stocks,” points out Sampath Kumar MP, CEO, Positive Systems, Kochi.
IHS iSuppli has predicted a decline of 11.8 percent in HDD revenue to $32.7 billion worldwide in 2013 compared to 2012. It further states that the HDD revenue will remain flat in 2014 at $32 billion.
“Component
markets would not have taken a beating if drive prices had not gone up.
While OEMs got supplies at right prices, assemblers had to pay heavily”Sampath Kumar MP, CEO, Positive Systems
IHS iSuppli predicts that the average selling price of hard drives will decrease by 7 percent in 2013. At the same time it expect SSD prices to fall by over 60 percent through the year.
Both Seagate and Western Digital have been shipping hybrid drives which use a small capacity SSD for either caching or storing critical data such as the operating system and traditional spinning disks to create larger capacities. While these drives are typically 40-100 percent more expensive than traditional drives, the performance is almost comparable with low-end SSD drives.
Motherboards
“The
explosion of digital content is driving the need for storage and flash
memory irrespective of whether a person is using a mobile, tablet or
notebook”Manisha Sood, Country Manager, Sandisk India
In H22013, the big bet is a transition to the new LGA1150 socket as Haswell processors hit the market. Many partners also expect Intel to cut its production of previous-generation processors to ramp up volumes and accelerate the transition to the new processors by year-end; this would get the motherboard upgrade market moving.
Some motherboard vendors are optimistic. Says Rajan Sharma, VP, Sales, Motherboard, Digilite, “We are expecting above-average growth in FY2013-14 if the corporate and SMB segment turn around. Increasing focus on small form factor PCs and penetration into Class B- & C cities will drive the segment.”
Graphics cards
According to AMD India, the independent graphics card market is hovering between 1,50,000 to 2,00,000 units, and growing. Says Vikas Gupta, MD, Technology & Gadgets, a Mumbai-based authorized distributor of AMD and Nvidia graphics cards, “We have witnessed a 50 percent increase in our sales compared to early 2012. We used to sell 5,000 units per month, but now, for the last five months, we are selling 7,500 units. The demand is more because of the enriched content from social media sites, YouTube and movie watching, as well as professional use by design and animation studios.”
Adds Rajesh Gupta, Country Manager, India, Zotac, “The demand for professional graphics cards is quite high because India is slowly emerging as a destination for creative outsourcing services.”
Memory
According to IDC, after an increase of 21.4 percent in 2012, the average growth of DRAM content per PC is expected to decline to a record low of 17.4 percent in 2013.
Opportunities in the memory market will be limited to opportunistic players because prices are expected to keep fluctuating. “We do not expect any major transition to happen in the next few quarters as it will be DDR3 only. Opportunities for upgrades remain good, with costs being low especially for notebooks,” says Piyush Pandey, Marketing Manager, Strontium India.
Removable storage
The removable storage market is expected to be healthy. “The explosion of digital content is driving the need for more storage and flash memory irrespective of whether a person is using a mobile, tablet or notebook. We see new technologies such as 3-bit-per-cell (X3) also improving the overall reliability of the solution,” says Manisha Sood, Country Manager, SanDisk India.
“As
the market matures there will be opportunities in gaming PCs,
workstations and other embedded devices. System builders need to find
their niche in these areas”Sushmita Das, Country Manager, Kobian India
ODDs
With a shift toward smaller form factors and with the proliferation of Internet broadband, the optical drive market is declining rapidly. The average prices of DVD writers fell to less than Rs 1,000 last year. While further price drops are not expected, channels do not see demand for optical drives as a standard option with PCs. With the faster USB 3.0 media being preferred even for installation of software, the days of optical drives are numbered.
Outlook
While the assembled desktop market which fuels the building blocks segment has declined rapidly over the past two years, most vendors are optimistic that the decline will be arrested, and that the next two years may see a flat market, which seems to be the best news for them.
“Growth will be flat, but the market size will remain stable for the next two years, following which the size may reduce with the changes in technology. However, as the market matures, there will be significant opportunities for assemblers in gaming PCs, workstations and other embedded devices. System builders will need to find their niche to leverage these opportunities,” says Sushmita Das, Country Manager, Kobian India.
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