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Andrew Walsh takes a look at the growth in desktop computing

PC gaming is core to desktop growth

GfK’s Andrew Walsh takes a look at how consumers are willing to spend more on a gaming PC.

The traditional desktop market has experienced somewhat of a renaissance in recent months.

There was an upturn in October 2013, which stemmed the flow of 15-month consecutive year-on-year volume decline in the retail channel.

But now we have seen traditional desktops enjoying a year-on-year growth in eight of the last nine months to June 2014. Excluding professional operating systems, there has been seven months of growth in the last nine months.

The catalyst for this upturn in fortunes can closely be attributed to the growth of quad-core share in the market, starting in October 2013.

Over the same time period, the market has also seen the average price for a tower with quad-core register between £440 to £500 every month since October 2013. However, the previously annualised average was £525.

Dedicated or semi-shared graphics memory has also been another driver of growth since October 2013. In the space of one month, dedicated memory trebled to 10 per cent volume share and now commands 18 per cent share in June. Hybrid memory has also doubled since September 2013, up to a 22 per cent share in June.

It is evident from the above that there is a tangible desire for improved desktop specs, which are now available at lower prices.

However, they are still more costly than dual-core or shared graphic memory, which shows gaming consumers are willing to spend more on their machine in order to maximise their gaming experience and investment in video gameplay. The reason we have seen this upturn now is linked to the release of new consoles pushing the recommended system requirements up for cross platform games.

IT markets associated with gaming also performed very well during Q2 2014. The retail graphics card market saw value increases of 8.5 per cent in Q2, but a volume decrease of 1.1 per cent with ASP rising 10 per cent. This occurred because of a market shift towards high end gaming focused cards and away from the sub-£30 entry level cards typically bought to extend the life of a desktop but not to run games.

Monitor sales saw a similar pattern to graphics cards, increasing 2.5 per cent in volume and 17.8 per cent in value. The value growth was driven by 2560×1440/1600 resolution monitors, the price of which has fallen to the point of being affordable for gamers, thereby driving ASP in this market up.

In contrast to TVs, 4K monitors are seeing slow adoption rates. Their primary target audience is gamers, but the amount of graphics hardware investment needed to run games at 4K is well beyond the reach of most consumers.

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