Ian Nethercot, MCIPS, Supply Chain Director at IT digital marketplace Probrand, continues his monthly roundup of the latest movements in the IT market to help with your buying decisions.
The end of 2019 followed the same ups and downs we saw earlier in the year. In December, the big headline was Intel’s processor shortage which will continue to plague the company in 2020 and beyond. Original Equipment Manufacturers are struggling to fill orders meaning Intel has taken to resurrecting old processors to try and plug the supply chain gap.
To help navigate the ups and downs and maintain a clear view of what represents a fair price, here are some of the latest developments and major movements that are influencing key IT product categories.
Exchange rate
The euro finished where it started against the GBP in December. Starting at 0.8513 on the first of the month and rising to 0.9542 on December 2, the euro then fell hard, hitting 0.8411 by December 9 and bottoming out at 0.8328 on Dec 13. A steady rise then followed, peaking at a high of 0.9560 on Dec 24, before dropping back down to end the month at 0.8505.
It was a different story against the USD, where the euro started at 1.1016 and steadily rose to 1.1154 by December 13, falling to 1.1072 by December 21 before a steady climb that saw it end the month up against the USD at 1.1215.
The eurozone economy fell to its worst quarter since 2013. The Financial Times said that economic growth will continue to slow in 2020 at just 1.1%, down from 1.2% growth in 2019, 1.8% in 2018, and 2.4% in 2017.
Phones and Tablets
According to IHS, Samsung dominated the 5G smartphone market in Q2 and Q3, with 1.5m units shipped and 83% market share in Q2, and 3.2m units and 74% market share in Q3. LG came in second with just 0.3m units and 15% market share in Q2 and 0.4m units and 10% in Q3. Meanwhile, IDC noted global smartphone production volumes grew 7.6% QoQ in Q3 to 358m units.
In tablet news, IDC said the EMEA tablet market fell 8.2% YoY to 10.9m units shipped in Q3, with Western Europe alone dropping 6% YoY. By vendor, Apple topped the market with +3.4% YoY to 2.42m units and 22.2% market share, ahead of Samsung (-18.6% to 2.05m and 18.8%), Lenovo (+5.1% to 1.2m and 11%), Huawei (-18.9% to 0.98m and 9%) and Amazon (+8.4% to 0.88 and 8.1%).
Looking ahead, IDC forecast both Q4 and 2019 to drop 10.2% YoY, while, by operating system, Android will continue to dominate from 2019 through to 2023.
Traditional PCs
Global gaming desktop and notebook PCs grew 10.1% YoY in Q3 to 10m units, IDC said. Looking ahead, gaming desktop shipments will drop from 16m shipments in 2019 to 15.9m units in 2023, while gaming notebooks will enjoy a 7.4% Compound Annual Growth Rate to reach 26.4m units by 2023, up from 19.9m in 2019.
Meanwhile in EMEA, gaming desktop PCs and notebooks grew 2% YoY to 2.2m units in Q3 and will grow to 4.1% YoY in Q4, taking 2019 up 0.3% YoY to 8.4m units, said IDC.
Processors, MEMs, Semiconductors
Intel’s chip shortages have continued to threaten its position in the market and are also affecting IT departments’ ability to upgrade legacy equipment. The company has faced supply issues relating to its 14nm and 10nm processors since September 2018, and in November wrote to its customers apologising for the shortage. The company has invested heavily in 14nm wafer capacity but has been unable to absorb a sharp increase in demand, it admitted.
Computer Weekly revealed that PC makers including Dell and HP are finding it difficult to source enough Intel processors to satisfy the needs of companies upgrading from Windows 7.
With the chip shortage expected to linger into 2020, Intel has resorted to resurrecting discontinued silicon. It will revive its Haswell Pentium G3420, a four-year-old chip built on the 22nm process. Meanwhile, AMD is taking full advantage of the situation as it prepares to ship 7nm processors.
Global semiconductor revenue dropped 0.3% on the month and 10.8% YoY in November to $36.7bn, the SIA reported. IHS said Q3 semiconductor revenue fell 14.7% YoY to $111.3bn.
Monthly statistics
The number of new products that came onto the market was slightly lower than November, with a high of 1,455 new products launching between December 13 and 15 compared to a high of 1,835 the month before.
The highest number of total price increases happened on December 23, with 38,539 price hikes occurring across a variety of product categories. At the opposite end of the scale, there were 44,289 price decreases on December 2.
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