March heralded the return to growth for much of the IT Channel, and April continued that trend.

A sunny month puts a shine on IT

With the retail channel for total IT showing a 7.6 per cent value growth year-on-year for April and even a 1.1 per cent volume growth as well, some categories are really in the sun. Key performers are desktop computers, growing 18.7 per cent in value (16.7 per cent in volume), as well as the indomitable netbooks growing 47.7 per cent in value over the same period (44.3 per cent in volume). Even notebooks, long expected to be cannibalized by netbooks, outperformed the prescribed trend with a 5.2 per cent value growth in April.

Despite this, all is not as it seems within the notebook-netbook shift due to a general price increase in notebooks. Despite the value increase, with the average selling price (ASP) of notebooks increasing significantly, we’ve seen a 5.2 per cent volume decline month-on-month. There is a slew of new tablet devices coming to bear in mind here, however, as this may be affecting consumer’s willingness to purchase currently.

There are some categories not performing quite up to scratch, of course. One of the biggest is digital photo frames which has seen a decline in units, value and ASP – 15 per cent, 30 per cent and 50 per cent respectively. With trade brands now making up such a large section of this market it will be interesting to see over the next 12 months how the rest of the sector responds.

Desktop computers were perhaps the most unexpected winner in April, with many considering the move towards the more mobile form factors inevitable. This was due to the move towards newer, more exciting units such as all-in-one (AIO) Computers and Micro Computers. In fact, Micro as a whole grew an extraordinary 737 per cent in value vs April 2009 and AIO computers showed a good increase in value also, though only 35.5 per cent growth in value vs 2009 due to a growth from a larger sales base already established.

What’s most interesting is that despite the growth of the lower priced micro form factors, the AIO is counterbalancing this trend towards a lower average selling price – meaning the category grows in value and volume almost equally.

The tip to watch for this year, though, is the media gateways category – items designed to allow the streaming of your favourite TV shows, music or photos to your television from your PC or storage.

From a not insubstantial base we are seeing value growth of over 100 per cent this month, as well as a price decline of over 50 per cent as they move into the mainstream. There are some positives this month, as well as some negatives. With the sunshine uncertain, how will IT weather the storm?

For further information please contact Christopher Kennedy-Sloane in the UK on +44 870 603 8136 or email christopher.kennedysloane@gfk.com, www.gfkrt.com/uk

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