• IT Supply Chain Insights - January 2017

Welcome to this monthly IT Supply Chain Insights. This monthly alert will keep you up to date with market trends and IT channel news giving you the knowledge you need to save time and money buying IT.

 

Executive Summary

 

24,057

The largest number of price increases happened on December 26, with 24,057 rises in a single day.

Jump to Monthly Stats
  • Tablets are on the verge of a rebound
  • SSD adoption to pass 50% in notebooks
  • DRAM and NAND continue price increases

There have been some markets in decline this month, including the global printer and enterprise and HDD storage markets, but it wasn't all doom and gloom for the IT channel.

Tablets are set to rebound, smartphones are on course for long-term shipment growth, DRAM and NAND prices continue to increase, VR and wearable shipments all are booming, semiconductor sales are up, SSD adoption predictions look good for and large-size and 4K TV panels continue to create noticeable presence within their markets.

 

Exchange Rate

 

The euro started poorly but ended strongly in contrast to the GBP this month. It dropped from 0.8448 to 0.8372 by 3rd December, recovering to 0.8493 by 7th December and then entering a decline. It eventually hit its monthly low of 0.8364 by 18th December and then recovered strongly, jumping to 0.8511 on 23rd December and again to 0.8564 by 30th Dec, only conclude the month slightly down at 0.8521.


British Pound (GBP) per 1 Euro (EUR)

 

The euro, however, had no such luck in contrast to the dollar. After rising from 1.0613 to 1.0746 on 6th December. It was all downhill from there, falling to 1.0558 by 10th December, and following sharp rise to 1.0434 on 16th December, another drop to a low of 1.0390 by 20th December. After sitting at 1.0444 from 22nd- 29th December, the euro rose to 1.0536 on 30th December, but fell to sit at 1.0516 on 31st December.

US Dollar (USD) per 1 Euro (EUR)

 

 

The Eurozone experienced its highest inflation growth since 2013 this month when annual inflation rose to 1.1%, up from 0.6% in November and 0.2% in December 2015. Higher energy prices, services, food, alcohol and tobacco, and non-energy industrial goods all posted growth this month helping driving the inflation.

The Eurozone was also boosted by the ECB's extension of quantitative easing, while business activity also grew, despite political uncertainty surrounding Trump and Brexit.

Euro (EUR) per 1 British Pound (GBP)

 

US Dollar (USD) per 1 British Pound (GBP)

 

 

Price Changes

 

Price Changes and News throughout December, 2016

Phones and Tablets

Over 100,000 smartphones are damaged by liquid every single day in Western Europe alone says IDC. Liquid damage is the second-biggest cause to damaged smartphones worldwide and accounts for 35% of all smartphone repairs, it warned. This is what's reported to be driving shipments of water-resistant smartphones, with shipments in Western Europe for January to September 2016 up 45.2% to 22.5m units and constituting 23% of the smartphone market. Non-water-resistant smartphones fell 17.1% YoY to 75.2m units over the same period. Meanwhile, worldwide mobile shipments will continue to take pleasure from growth for another few years, states Gartner, forecasting units shipped to develop from 1.888b in 2016 to 1.937b units by 2019. Even with a 12% YoY dip in shipments in 2016 to 182.3m units, IDC is predicting 2018 to be the year the worldwide tablet market rebounds to piggyback the growing detachable tablet market.

Traditional PCs

Gartner is predicting shipments of traditional PCs (desktop and notebook) will drop from 219m units to 193m units by 2019. However, it's not all bad news, with Gartner suggesting the PC market may benefit from an alternative period during 2018 that will ease the decline.

Premium Ultramobiles/Wearables

Gartner suggests global shipments of premium Ultramobiles will grow from 49m units in 2016 to 85m units in 2019, while basic Ultramobile shipments will drop slightly over the same period, down from 168m units in 2016 to 166m units by 2019.

Fitness trackers led the worldwide wearable market in Q3 with 3.1% YoY growth in shipments. Of the 23m units shipped, Fitbit claimed the top spot with 5.3m units shipped and 23% market share, second was Xiaomi (3.8m units) and third, Garmin (1.3m), reports IDC. Apple in fourth fell 71% YoY to 1.1m units, while Samsung in fifth enjoyed 89.9% growth to 1m units.

TrendForce predicts VR devices will reach 2.91m units in 2016 and grow 75% in 2017 to 5.1m units. Sony will lead the industry with 1.5m units shipped in 2016 and 2.5m units in 2017. Meanwhile, IDC states 10.1m VR headsets shipped in 2016 and that 61m will ship in 2020. The disparity between IDC and TrendForce's figures is because the former tracks screen less viewers designed to accommodate mobile, like Samsung's GearVR, whereas the latter doesn't.

Processors, MEMs, Semiconductors

The Semiconductor Industry Association this month reported global semiconductor sales for November were up 7.4% YoY to $31b and up 2% on October. By region, Europe enjoyed 2.5% growth on the month in November in comparison to October, but fell 1.6% YoY.

Memory

TrendForce reported, average contract costs for 4GB PC DRAM grew 2.86% to $18 in November in comparison to October, alongside spot prices of DDR3 (6% to $2.6) and DDR4 (2% to $2.53) chips also enjoying growth on the month. The report also suggests 8GB chips from 20nm processes will overtake 4GB and become PC DRAMs mainstream product in 2017.

In other news, the existing NAND flash shortage will cause a price increase of over 10% for enterprise and client SSDs between Q4 2016 and Q1 2017, TrendForce predicts. The NAND flash industry will experience a mere 6% growth in wafer capacity in 2017. 3D NAND has become the main market driver, resulting in a marked drop in 2D NAND supply. The industry for 3D NAND will remain tight until suppliers can apply 64-layer methods OEM storage products, the analyst firm said. DRAM prices will continue to increase through 2017 as supply expansion is restricted to less than 20%, and DDR3 4GB module prices have broken through the $25 barrier. Prices are set to attain record off-season increases of 30% in Q1 2017.

Storage

The IDC reports, typically, factory revenue for worldwide enterprise storage systems fell 3.2% YoY to $8.8b in Q3 2016, while capacity was up 33.2% YoY to 44.3 exabytes. Only ODMs selling to hyperscale clients are making more income here.

Despite losing 12.6% YoY in revenue and 2.7% market share, Dell owned top spot with $2.25b and 25.5% market share. HP came in second with $1.36b in revenue and 15.5% market share, down 8.1%, while NetApp claimed third over IBM and Hitachi with $587.1m and 6.6% market share.

The worth of Western Europe's external storage market and its capacity both fell around 5% YoY in Q3 to $1.06b and 1.978.7 petabytes. The same report IDC stated the higher EMEA region enjoyed huge growth in the flash market, with all-flash up 76.4% on the season, and hybrid flash arrays up 3.5%, while traditional HDDs fell 33.6%.

In other news, the SSD market is predicted to soar in 2017 with total SSD adoption in notebooks for Q4 2017 to be over 50% during Q4 this year, states TrendForce.

Displays

In accordance with a number of reports on TVs by TrendForce this month, global LCD panel shipments fell 0.9% in November on October to achieve 22.79m units, vendors are dedicated to promoting bigger than 32” sets following their 40% upsurge in production prices, and global LCD shipments are set for 1.9% YoY growth for 2016 to 220m units, where large-size (55”+) panels will account for 20% of all shipments and 4K sets will reach 31.5% penetration.

TrendForce predicted that the large-size TV market will achieve above seasonal demand in 1H 2017, while H2 of 2017 will undoubtedly be determined by supply and demand variables centred on vendors need to cut back excess inventories.

In other news IHS has forecast flexible display shipments for smartphones to cultivate 135% YoY to 139m units in 2017, representing 3.8% of total display units shipped. In a written report on AMOLED smartphone display shipments, IHS noted that despite accounting for under 2% of the industry in Q3, Chinese manufactures exceeded 1m units shipped for the very first time, further recognising an increasing reliance upon their manufacturing technology.

Printer

The global hardcopy peripherals (printer) market continued to decline in Q3, with shipments down 3% to 25m units. IDC said HP claimed the highest spot with 9.5m units (down 4.7% YoY) and 37.9% market share, while Canon in second shipped 4.9m units (down 7.1% YoY) and 19.6% market share. Epson took third with 4.5m units and 18.3% of the industry, enjoying 12.2% growth in shipments driven by strong sales in Asia/Pacific.

On an optimistic note, Western Europe's laser printer market enjoyed a 1.9% YoY growth in shipments in Q3, bucking the negative trend seen over the last five quarters.

Context reported that global desktop/personal 3D printers experienced over 25% growth in the initial three quarters of 2016. 96% of most 217,073 3D printers shipped globally were desktop/personal, have an average cost below $1,000 per unit.

Regarding revenue, despite stalling and accounting for 4% of the industry and 7,726 units shipped, 3D industrial/professional printers accounted for 78% of the global 3D printer market.

 

Monthly Stats

 

Monthly Statistics

New products started at 12, jumped to 17, fell to 8 for three days and then hit its monthly high of 38, all by 7th December. Decreasing to 25 by 10th December and following some increases and decreases, {new products|services|new services} then hit a low of 0 on Dec 28th, and ended the month on 1.

Cisco yet again dominated price increases while Fujitsu edged Cisco in price reductions by manufacturer.

Daily price increases started at 17,912 and fell immediately to 8,345 where it sat for three days. An instant jump to 16,650 on 5th December was followed with a drop to 4,779 on 6th December. A series of increases and decreases with a bit of stability then followed, until it achieved its monthly high of 24,057 on 26th December, low of 541 on 27th December and ending the month at 6,749.

Daily price decreases jumped immediately from 15,496 to 18,300 where it sat from 2nd to 4th December. This rising and falling continued, with highlights including reaching a high of 30,0381 on 19th December, to a low of 50 on 27th December, and ending the month at 11,719.

Stock up rose sharply from 2,856 to 19,708 on 2nd to 4th December, fell to 2,054, recovered and then dropped again. These movements carried on throughout Dec, with highlights including falling to 14th on 13th December, peaking at 52,291 from 17th to 19th December, another fall to 33 on 27th December and seeing out the month at 1,497. Stock reductions sat stable at the start of the month, fell, recovered, skyrocketed to 51,667 on 12th December, fell to 27th on 13th December, recovered and then fell again, eventually sitting at 3,687 on 30th December.

New Products December 2016

 

Prices and Stock Movements December 2016

 

 



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