Michael,
re: In the corporate business, here will be a replacement market for those machines that are uneconomic to repair any further, and there will be continued slow penetration of new consumer markets and new markets overseas. Still, I think it's quite possible that growth ends up in the 5% range.
It's easy to discount the upgrade cycle. Folks have done that at the bottom of each previous PC cycle, and they have always had a bunch of very good reasons. I have no doubt that, at some point, the replacement cycle will expand in time, it may very well happen in this cycle.
At some point, it gets uneconomical to continually replace parts. Three year old hard drives are too small, standard memory from three years ago is usually not adequate. The PC's don't have CD-RW's. They probably have a lot of software "issues" from all the crap that has been loaded and deleted over the years. And the processor is getting slower, in comparison to what is available. Right now the 500 MHz PC competes with a low end 1.7 GHZ, in a year the low end may be 3 GHz.
There was a huge blip in PC sales from mid-1999 to mid-2000, peaking at 50% YOY sales in around June of 2000. With that much hardware going into the field, a good guess would be that sales would be soft for quite a while. Do those all those PC's get replaced on the same 3 year schedule we've experienced over the years? Is it 3 years 6 months, 4 years? Never? Hell, I don't know. I don't think anyone does. I include you in anyone.
John |
