Pakistan Portable Market Registers Highest Ever Growth of 64.1% YTY in Q2 2006, Springboard Research Finds

Singapore & Islamabad – November 30, 2006

Springboard Research, a leading innovator in the IT Market Research industry, today announced that Pakistan PC shipments grew 20.9% in Q2 2006 (April-June) to 173,834 units as compared to the same quarter of preceding year. The portable segment experienced the substantial growth of 64.1% year-to-year mainly due to a major deal of 4,500 portables announced by Bahria University. The government’s continuous effort to automate the different public and private sector bodies was also noticeable in the quarter. In the federal budget for Fiscal Year 2006-2007, the government announced an imposition of 15% General Sales Tax (GST) on the import and sale of computers and software, which will negatively affect the country’s PC/Server market.

The second quarter of 2006 yielded stiff competition among multinational vendors in the desktop market. HP led the market with 5.1% share, followed by Lenovo and Dell. The government agenda of promoting local players seems to be materializing for the domestic market development. During Q2 2006, Raffles, a major local player, registered the highest growth in the PC market with 49.5% year-to-year growth, while Inbox (another local player) shipments also grew substantially.

Amongst all segments, government held the greatest share (23.7%) of total PC shipments in Q2 2006, followed by large enterprises (500+ employees) and the home segment. Additionally, Springboard saw the government, banking and telecom sectors spending heavily in strengthening their IT infrastructure.

One area which has drawn attention from both local and international players is the growing telecom sector in the country. Pakistan’s telecom sector has witnessed unprecedented growth in the recent years with the total IT spending in the industry estimated at US$134.5 million in 2005, generating 22.5% annual growth. Currently the hardware segment accounts for about 70% of the total telecom IT spending in the country. “With the deregulation of the fixed line and mobile sectors we expect to see a considerable amount of investment both locally and internationally. In this event, IT business opportunities for vendors will be accelerated,” commented Rehan Ghazi, a market analyst in Springboard Research’s Pakistan office.

Although the government has announced new standard operating procedures and projects for the IT industry, the GST imposed in the new fiscal budget will increase computer prices by at least 15-20% and make them unaffordable for some home users, educational institutions, and other price-sensitive users. “Our latest forecast for 2006 and beyond has been decreased as we expect to see a 10-15% decline in the branded machine sales. We expect the market to grow 23.4% in 2006 as compared to our earlier forecast of 25.0%”, added Mr. Ghazi.

The Pakistan PC/Server market is one of the fastest emerging segments in South Asia and in the past few years, the market has attracted a lot of attention from international IT vendors. Improving economic indicators and foreign investor’s confidence will help the sector gain momentum as well. The growing trend of strengthening the IT infrastructure by both government and private sectors may trigger an expansion of competition in the market.

About the Asia Emerging Countries Tracker

Asia Emerging Countries Tracker is a Springboard Research service that tracks PC/Server market developments in Bangladesh, Brunei, Cambodia, Sri Lanka and Pakistan on a quarterly basis. The methodology employed for this service leverages interviews with IT resellers, vendors, component suppliers and end-users at the local and regional level.

About Springboard Research

Springboard Research represents value, integrity and insight. Lead by a team of dynamic industry experts, Springboard Research provides its customers with high value IT market research that helps them identify new market opportunities, growth engines, and innovative ways to go to market, which means Springboard’s clients lead rather than follow market trends. Not bound by legacy, Springboard’s cutting-edge research model leverages its offshore research centres, the Internet, and an increased use of technology as engines of innovation to deliver unique research value. This means that clients have a real alternative for IT market research and where knowledge is delivered in more useable and interactive formats. Springboard Research works with the largest IT companies in the world across the hardware, software, networking, and services sectors.

Founded in 2004, Springboard Research serves the needs of its clients globally through offices in the United States, Singapore and Japan as well as global research centres in India and Pakistan.

For more information regarding Springboard Research, please visit www.springboardresearch.com.

Contacts

Chris Perrine
Vice President – Business Development
Springboard Research
65-6236-7681
cperrine@springboardresearch.com

Dane Anderson
Vice President – Research
Springboard Research
65 6236-7682
danderson@springboardresearch.com


Rehan Ghazi
92-51-7116322
Market Analyst, Pakistan
Springboard Research
rghazi@springboardresearch.com