From the devastating earthquake that hit Japan to the severe flooding in South East Asia, from the revolutions in the Middle East and North Africa to the debt crisis and economic woes of the eurozone, 2011 was a year of turmoil.
The year also saw grey clouds hover over the UK economy - not only due to these incidents abroad but factors at home as well - including increased VAT, austerity measures, poor economic outlook and consumer confidence, not to mention the riots.
The IT industry also had its fair share of ups and downs. Market trends and dynamics changed completely over the course of the year. However, despite the odds, the market as a whole was up 16.8 per cent by volume and 19.5 per cent by value from 2010.
I should include that December contained five weeks instead of the usual four. Hence, for all year-on-year comparisons in this article we took only four fifths of total December 2011 sales into account.
Web books have played an instrumental role in boosting the IT market, without which the sector would have seen some turbulent times. GfK defines a web book as a device with a screen of at least 5.5in, a mobile OS, and an ARM or equivalent processor.
Growth was actually seen in a mix of product groups, which is always a very positive sign. The worrying bit, however, is that towards the end of the year the more traditional PC form factors, such as notebooks, netbooks and desktops, continued to decline year on year in both volume and value terms.
The past year saw the notebook sector record its lowest value share of the total PC market for five years.
The traditional side of the segment is likely to struggle moving further into 2012, but innovation - for example, ultrabooks and Google’s Chrome book - may improve segment performance.
Consumer channels grew by only 9.9 per cent in value year on year. The largest-value growth actually came from B2B channels, which were up 34.9 per cent on 2010, primarily on the back of storage and software markets.
On the consumer side, web books continued to dominate, accounting for 17 per cent of the total UK consumer IT spend in 2011.
Interestingly, although notebooks were down year on year for the total audited market in 2011, the last couple of months saw the category show signs of growth on the consumer side of the market. A major contributor here was the fading impact of the UHA scheme and strong year-on-year price drops in the run-up to Christmas.
Last year’s UHA scheme subsidised laptop purchases for 250,000 households, artificially inflating sales and affecting year-on-year growth rates.
Another trend is the strong growth of online sales. For the last calendar year, online sales represented 25.3 per cent of total consumer-channel IT sales, up from 22.7 per cent the year before. In comparison to 2010, online sales volumes rose 16.1 per cent - a clear indicator of the growing importance of the internet channel.
Despite the turbulent times and changing market dynamics, the outlook for 2012 seems generally positive, with web books emerging as the IT industry’s new backbone. Although heralded as simply the latest fad, the category has definitely made its mark, pushing the Q4 sales volume for computing devices higher than ever before.
Regardless of their functional limitations, web books have now taken a place on the mantle beside more traditional PC form factors.
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