A peripheral concern?

We all know the PC market has been showing excellent growth over the last couple of years. Despite a decline in desktop PC sales (down 9.7 per cent this February against February 2009) the total PC market has continued to see good growth, with notebooks and, more recently, netbooks driving sales forward (up 5.1 per cent over the same period).
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However, the peripherals market is rarely in the limelight, despite being a very varied and dynamic arena of the IT landscape.

When we look at the historical trends of peripherals and set them against those of the PC market in general, we can see that since around Q4 2008 key peripherals markets have seen declining sales.

Communication devices (e.g. wireless routers, access points and USB hubs), communication cards, printers and keying devices have all been affected by the inherent or increasing capabilities of PCs themselves.

The fact that most laptops are sold with integrated wireless capability (98 per cent of mobile computers sold between February 2009 and January 2010) has had a significant impact on communication card sales.

And, as more and more ISPs give away wireless routers with subscription packages, the retail markets suffer. However, companies in these segments are rising to the changing dynamic and trying to boost sales. The N standard is becoming more popular in the router market, representing over 50 per cent of the sector in February.

Printers have also had a tough time of late, but again movement towards wireless functionality is improving sales for manufacturers. Wireless printer sales represented 45 per cent of the market in February, compared with 25 per cent during the same period last year.

There are two clear-cut peripheral categories showing growth: mice and storage. The growth of mice sales shows consumers prefer these devices over built-in trackpads.

With regards to storage, external devices are driving the market, which year-on-year was up 42 per cent in volume and 25 per cent in value during February. These two categories comprised £78 million in January and February alone, and this makes up 45 per cent of value in the total peripherals market.

So what can we learn from these trends? With peripherals it is becoming increasingly important to focus on the quality and the technological capabilities of the product.

There are great opportunities in these markets as ideas such as the ‘wireless home’ become more of a reality, and consumers focus in on enhancing their PC experience. Greg Allen can be contacted on 0870 603 8121.

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