Intel dominates in improving PC chip market

Global microprocessor shipments for the first quarter were up 39 per cent on last year's levels as the IT industry continued to show strong signs of recovery after the recent downturn.

Research firm IDC revealed today that processor sales were down just 5.6 per cent on the last three months of 2009 lower than the typical decline of seven or eight per cent between fourth and first quarters. But more significantly, a year-on-year comparison showed a healthy rise over the same period last year, when the global recession was at its worst.

And while quarterly sales were slightly down on Q4 2009, average prices were up 4.1 per cent, suggesting consumers and businesses were increasingly looking beyond just low-cost solutions another sign of market confidence.

"Consumers and corporations will be anticipating a much healthier 2010 and looking for more value than just low price in their PCs," IDC analyst Shane Rau said in a statement. "In terms of the processor, that means more openness to paying for benefits such as good performance and reduced power consumption that serves long battery life."

Intel increased its domination of the market, with 81 per cent of chips sold bearing its name. Rival AMD accounted for most of the rest, leaving third-placed VIA with just a 0.2 per cent share.

However, AMD lost ground to Intel in all categories desktop, mobile and server and saw its overall market share drop from 22.3 per cent to 18.8 per cent. It was particularly hard hit in the mobile sector, where Intel shored up 87.8 per cent of the market thanks to its low-cost Atom CPU.

The overall numbers are very much in keeping with other quarterly figures reported recently, with most technology firms seeing a significant jump in earnings from 2009 levels. According to IDC, overall PC shipments rose by 24.2 per cent in the first quarter as businesses responded to the newly optimistic market outlook.

The research firm forecasts a 15.1 per cent increase in global processor sales for 2010, but says low inventories and a strongly bullish outlook may push growth even higher.