Levant PC market set for solid rebound despite regional instability, says IDC

According to a recent IDC study, while the Levant PC market only saw single-digit shipment growth and flat revenue growth in 2006, the situation will rebound this year.

IDC expects shipments to soar 22% year-on-year to reach more than 282,000 units in 2007, with surging demand for notebooks pushing year-on-year revenue growth to an impressive 23.7%. Internet expansion, a growing awareness of the benefits of mobility, and increased IT investments by the region's key sectors (telecom, education, government, and banking) will see the total PC market expand at an average annual rate of 19% in volume through 2011.

"The ongoing political and economic instability in the Levant region makes the PC and general IT markets unpredictable," says Rami Barbarawi, Research Analyst, IDC Middle East and Africa. "Nevertheless, untapped demand should keep the market going; though it may be uneven for a while, particularly in Syria and Lebanon."

Desktops still account for the largest share of PC shipments in the Levant. According to IDC, desktops represented 71.5% of total PC shipments in 2006, while notebooks accounted for 26.3%. Notebook shipments will, however, rise 1.7 times faster than desktop shipments over the next five years. The x86 server market is also expected to perform well. Although accounting for just 2.2% of shipments in 2006, the x86 segment is forecast to expand at an annual average of more than 20% in volume through 2011.

According to IDC, the Levant PC market's growth is being largely driven by the Jordanian market, which is set to expand a healthy 25.1% in volume year-on-year to reach nearly 120,000 PCs in 2007. Overall, the Jordan PC market's expansion will be fueled by a strong uptake within the notebook segment, mainly by the fast-growing SME (small and medium-sized enterprise) and SOHO (small office and home office) segments. Furthermore, large desktop and x86 server rollouts are expected to take place within the leading market verticals of government, telecom, and banking during 2007.

The Lebanese market is expected to rebound to some degree in 2007, with year-on-year volume growth expected to reach 17.7% representing more than 92,000 units. This expansion, however, does not reflect the real potential of the market or the demand that exists within it, due to the ongoing political and economic unrest in the country.

With U.S.-imposed economic sanctions on Syria set to continue, IDC expects the country's PC market to experience only moderate growth in 2007. The market will expand 23.9% in volume year-on-year to reach over 70,000 units. Growth will continue to be driven mainly by Far Eastern and domestic players, as they take advantage of the economic constraints faced by international vendors.

IDC's Levant Personal Computing 2007-2011 Forecast and 2006 Vendor Shares (IDC# ZJ05P) report provides detailed analysis, conclusions, and forecasts regarding the dynamics of the Levant PC market. The information in this study is intended to provide an understanding of the changes and challenges facing the PC industry in the region. IDC's 2006 figures and analysis are based on information gathered from interviews with leading IT companies (vendors, distributors, assemblers, system integrators, value-added resellers, and dealers) active in the region.