Growing IT awareness in the country and increased focus from multinational IT vendors, Pakistan's PC shipments grew by 16.6 percent in 2005 to reach 494,000 units. Additional market accelerators include strong economic growth, the government's drive to privatise the economy and efforts to develop the ICT sector.
Although the October 8 earthquake held shipments back marginally in fourth quarter due to delayed government buying and general economic disruption, it is not expected to impact the market materially in 2006 and beyond. Similarly, social unrest and political instability are not expected to derail the market's strong overall momentum over the next several years.
"Due to political and social disruptions as well as general perception challenges, the Pakistan market has traditionally been neglected by international IT vendors; however, the market's explosive growth over the past several years has led it to a scale that is drawing increased attention," noted Dane Anderson, Vice President, Springboard Research.
"It is not an exaggeration to call Pakistan one of the most promising and dynamic PC markets in the world." The country's PC market continues to be highly price-conscious, and remains dominated by locally assembled machines, which hold over 75 percent of total shipment market share. Among international players, HP leads the market with a unit market share of 9.2 percent. HP is followed by Lenovo/IBM and Dell. Local brands Inbox and Raffles are also major players, and are increasingly being viewed as formidable competition for international giants in Pakistan.
Desktops, which represent the largest portion of the market, registered shipments in excess of 469,200 in 2005. Amongst all the product sectors, the portable market led growth in 2005 with 21.3 percent expansion, followed by X86 servers and desktops.
Portable PCs are expected to remain a particularly hot market segment throughout the forecast period as prices fall and the need for mobility rises. The position of notebook PCs as status symbols will also play a secondary role in driving sales. From a usage perspective, the public sector and NGOs are currently the dominant segment of the market.
However, large corporations - particularly in the finance and telecommunications sectors - are also key customers driving market growth. Although Small and Medium Businesses (SMBs) represent a large share of the country's total number of companies, they do not represent a commensurate share of the PC market.
In total, SMBs represented 21 percent of total 2005 PC shipments in the country.
"The SMB market represents a notable portion of shipments in Pakistan, but it is receiving secondary focus from IT vendors due to the substantial opportunities in the public and large enterprise sectors," noted Springboard's analyst.
In spite of social and political risks, Springboard expects PC market growth to rebound to 24.7 percent in 2006 driven by a release of pent-up demand from earthquake-related delays in fourth quarter, strong economic growth and IT vendor investments in sales and marketing activities.-PR