According to research firm IDC, the Indonesia PC market increased 4% in the first quarter of 2013 compared to the previous quarter but declined 2% on year, reaching 1.37 million units for the quarter.
Overall commercial spending in the first quarter was poor as enterprises held back on PC buying. However, the public sector invested heavily in PCs, which helped to mitigate the weak enterprise performance, said IDC.
"The slowdown in the commercial space was largely a result of exchange rate volatility as well as concerns over Indonesia's short-term economic outlook," said Deddie Sionader, market analyst at IDC.
"While public sector spending was high, most of those shipments were actually delayed fulfillments of budgets from 2012."
As mini notebook shipments continued to fall, consumer demand for PCs was also challenged by the availability of smartphones and tablets. Channel confidence in PCs further weakened as IT retailers continued to shift their portfolio focus to stock low-cost tablets and smartphones that are easier to sell, added IDC.
Deddie added, "Budget tablets may be replacing mini notebooks in the less developed regions of Indonesia, but many vendors have started to aggressively market low-cost notebooks to attract first time buyers and stem the decline."
The Indonesia PC market is expected to achieve 3% growth in 2013, said IDC, adding that vendors need to focus on the tier-two and three cities in Indonesia. Regions outside of Java and Bali achieved a combined on-year growth of 8% in the first quarter, while Java and Bali declined by 6% on year during the same period.
"Cities in Kalimantan and Sumatra will continue to show steady growth as channel penetration gradually improves," said Wilhendra Akmam, research manager for channels research at IDC Indonesia. "The overall PC market in Indonesia may be struggling but there are still many growth opportunities in the smaller cities, and although large projects are unlikely, the upcoming elections in 2014 could trigger some public sector PC projects. | 