Distributors already positioned to handle HP PC exit

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Distributors already positioned to handle HP PC exit

Simon Quicke

Distributors should be able to swallow the loss of HP's PC and tablet business thanks largely to the moves they have been making over the last few years to diversify their portfolios and rely less on just a small handful of large vendors to provide their revenue.

According to an analysis of the distribution market from Context the share of distribution revenues coming from HP's PC line has been steadily dropping since 2008 as rival vendors took more share of the market and the channel widened the number of suppliers it worked with.

At the start of 2008 HP accounted for 44% of total European distribution revenue but by the end of last year this had fallen to just 31% with more business being pushed through the channel from the likes of Samsung, Apple and Lenovo.

"This is, of course, still a significant share," said Context CEO and co-founder Jeremy Davies. "But we're seeing strong performance from other PC vendors and expect them to easily pick up any business HP will be leaving behind."

HP's decision to sell-off its PC business was made late last week and since the weekend its tablets have been reduced to clear stocks and the share price has taken a battering as investors react to the bold changes in strategy spearheaded by the CEO Leo Apotheker.

Although it could take as long as a year for the PC operation to be sold, and some channel observers are privately questioning the likelihood of a deal ever being struck, those selling the products have already started to react. The changes that have taken place in distribution in the last few years will continue and be accelerated.

At the start of 2008 an average of five PC vendors made up 80% of PC revenues in European distribution but by the end of last year the number had risen to seven.

Related Topics: Desktop PCs, VIEW ALL TOPICS

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