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PC assemblers retain stronghold

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DQW Bureau
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The Indian PC market has grown by close to 29 percent last year. This is

according to a recently announced report by a well-known market research agency.

Earlier, another resea-rch agency had put the figure couple of percentage points

higher.

However, the most interes-ting part is that both of them have been silent

about the assembler segment. None of them have mentioned assemblers even in

passing terms. And just two years back, these very assemblers used to command

close to two-thirds of the Indian PC market.

One of the above two-market researchers, not very long back, had said that

attractive prices from the assemblers would be the leading demand driver for the

Indian PC market. Along with that strong economic growth was also expected to

drive the PC market.

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Till sometime back, analysts reckoned that branded players were fighting

amongst themselves for market share, rather than aggressively targeting the

assemblers. Although a couple of vendors had tried lowering price-points, but by

enhancing the quality of service and extending this right up to the small

accounts would fetch them far better results than what they have been able to

achieve. But now, analysts believe that assemblers are on their way out.

Price and personalized service was perceived to be the strength of the

assemblers. As a result, SOHO users preferred to go to these vendors rather than

the branded players. Analysts added that in the days to come, it would be

increasingly difficult for branded PC players to compete with the assemblers

unless they augment their service capabilities coupled with attractive price

points.

On both the above points, branded PC vendors have done lots of work. Now,

their service infrastructure is available right into the B and C class towns and

entry-level prices are touching the Rs 12,000 mark with one player going below

the 10k price point.

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But has it made any dent into the assembler segment? Not really. With the

unified VAT regime in place and price gap narrowing, they may have been bruised

but certainly not dented. They are still doing well and will continue to do so

in the near future. This is because, they will always have price superiority

over the branded players. Secondly, the kind of personalized and 24x7 service

they can offer cannot be matched.

Overall, the Indian PC market is expected to grow at a similar percentage in

2005 also. Apart from the excellent economic conditions, strong demand from the

SME segment will power the robust growth. Education segment will be another key

driver. Interestingly, local assemblers are particularly strong in these two

segments.

So, there is no way the assemblers will become redundant in the near future.

In any case, nothing can rival the vital contribution made by the assemblers to

the growth of the Indian PC market.

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