In a first, PC industry de-grows 10%, phablets up 527%

Smartphone sales increased by 33% to 69.67 million while phablets registered a 527% growth over last year with 50.8 million sales

The popularity of smartphones and phablets has started showing up in India's personal computer sales, with the segment growth declining by 10 percent, for the first time in its history in 2014-15.

According to a annual industry performance review study by hardware lobby body MAIT and research firm IMRB, total PC sales, including desktop computers and notebooks, stood at 10.62 million in 2014-15,  

On the other hand, smartphone sales increased by 33 per cent to 69.67 million while phablets (with screen sizes five inch and above) registered a whopping 527 per cent growth over last year with 50.8 million sales. Phablet sales are expected to grow by around 65 per cent in the next financial year.

According to the findings, the overall size of the Indian hardware market, which includes computer peripherals, printers and servers, stood at $15.87 billion, a growth of 23.98 per cent over the previous year.

“Phones are driving all the growth, but PC sales are showing de-growth. The only way to arrest this is to look at ways to increase PC penetration in Indian households,” said Amar Babu, president of MAIT.

He added that enabling infrastructure, providing low-cost loans and discount vouchers could incentivise PC sales. “We also see a ray of hope for PC growth in future on account of some of the Digital India initiatives which aim at digital infrastructure as a utility for every citizen, governance and services on demand, and digital empowerment of citizens,” he added.

Despite the softness in the last financial year, PC sales are expected to increase by 17 per cent in the current financial year on account of a large contract from the Tamil Nadu government for 1.1 million laptops. Babu said the commercial and technical bids have been opened with Lenovo emerging as the lowest bidder. He did not specify who the other participants were.

Anwar Shirpurwala, executive director of MAIT, said government programmes had been instrumental in driving growth of notebook sales and had also led to their decline. “In a country where affordability is an issue, it is important for the government to provide the additional impetus for adoption of PCs, thereby, driving overall development of society.”

He added the bigger screen of phablets had made them desirable as a bridge between a multi-utility device and an entertainment device. However, phablets with screen sizes of only up to the 5.5 inches had found acceptance since the role of tablets as a ubiquitous device for consumers was fast diminishing, he added.

Tablets have witnessed a growth of four per cent after double and triple digit growth in the last three years, with sales at 3.48 million in 2014-15. The market is expected to see a growth fall by about 16 per cent in 2015-16 owing to consumers moving to higher screen size smartphones and phablets with voice calling facility.