• Technology Products Alert - December 2015

Welcome to this monthly Technology Products Alert. 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

 

27,914

The largest number of price increases happened on November 9-10, with 27,914 rises in a single day.

Jump to Monthly Stats
  • Emerging markets drive global phone shipments up 15.5%
  • Mobile DRAM growth minimising DRAM industry decline
  • Samsung makes inroads on Intel in global chip shipments with 10% Q3 increase

There have been a couple of bright patches between the IT channel dark clouds in November. The euro continued diving and it is currently at its weakest since mid-April, and even though the dollar hit an eight-month peak, end-of-month reports showed investors cautious prior to the European Central Bank meeting on 3rd December and the US nonfarm payrolls report on 4th December. The falling euro along with stock oversupply and manufactures changing market focus saw a decline in many shipments.

Chip sales were down, the LCD panel industry faced its first ever annual shipment decline, personal storage continued its dive as a result of a move toward cloud storage and market oversupply of PC DRAM pushed down market revenue.

On an optimistic note, emerging markets drove up global smartphone and phone shipments, and mobile DRAM is proving to be the gold star in the memory industry. An increase in the gaming segment also generated demand for display upgrades, in an unusual bright spot for the monitor panels industry. 50+" televisions are reporting growth whilst the 60+ inch TV panels experienced a substantial increase of shipments in the segment.

Companies are getting smarter in their moves regarding market oversupply. Emerging markets and their attention on new technologies may take a greater percentage of shipments.

 

Exchange Rate

 

The euro continued its decline in contrast to GBP over November despite a promising rise in early stages in the month. Starting the month at 0.7128, this dramatically dropped to 0.7087 on 4th November, followed by a sudden increase on 6th-7th November to the month high 0.715. From here it was all downhill though, bottoming out at 0.7001 on 18th November. A few days of very little movement continued until it hit another rise to 0.7043 on 25th November. Other than a slight dip on 26th November, the euro stayed on a level until the end of the month.

British Pound (GBP) per 1 Euro (EUR)

Exchange Rate Graph EUR vs GBP for November 2015

The trend was similar in contrast to the dollar. The only promising moment the euro saw was on the 2nd November, rising from the original 1.001 to 1.1025. The euro then experienced a remarkable fall to 1.0736 on 7th November, increasing slightly to 1.0771 on 13th November. From here it did not recover, limping in at 1.0578 by month's end. This is the weakest this has been since 12th April 2015.

US Dollar (USD) per 1 Euro (EUR)

Exchange Rate Graph EUR vs USD for November 2015

So, why did the euro fall so dramatically this month? Reports show the Eurozone economy was resilient throughout the month of November, with positive purchasing manager’s index (PMI) data. Nevertheless, the euro posted its biggest monthly loss since March as economists anticipate yet another monetary stimulus outcome from the early December ECB meeting.

Euro (EUR) per 1 British Pound (GBP)

Exchange Rate Graph GBP vs EUR for November 2015

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

Exchange Rate Graph GBP vs USD for November 2015  

Price Changes

 

Price Changes and News throughout November, 2015

Phones and Tablets

Markets drove global smartphone shipments in Q3 up 15.5% YoY to 353m units, while total worldwide mobile shipments increased 3.7% to 478m units for the exactly the same period. Based on Gartner Inc., the escalation in smartphone sales were driven by consumers in these markets upgrading ‘feature phones' to smartphones as a result of comparable prices.

Samsung (23.7% & 21.4%) and Apple (13.1% & 9.6%) were the market leaders share in all smartphone categories, while a move local brands in the emerging markets saw Micromax Informatics cement its place among the very best 10 worldwide mobile phone vendors, while Chinese brands for example ZTE, Huawei, Xiaomi, TCL Communication Technology, Oppo and BBK became increasingly hostile.

A WitsView's (TrendForce) report estimated a 9.6% YoY decline on tablet panel shipments to 207m for 2015, while IDC reported shipments will reach 211.3m units in 2015, a decline of 8.1% on 2014. Both reports show there have now been three consecutive quarters of global decline in tablet shipments, and while tablets are predicted to drop again next season to 200m, there is a glimmering light in the shape of detachable tablets, which are set to have a bigger escalation in the segment's shipment over the following few years.

Traditional PCs

TrendForce reported global Q3 notebook shipments rose 13% to 43.3m units on account of peak seasonality, although Q2 being a shorter period meant the numbers are not as great as they first appear.

The fourth quarter is the normal peak sales season in the American and EU markets. While MacBook sales continue to develop and non-Apple branded notebooks with Intel's Skylake CPUs have hit the market, quarterly notebook shipment growth will still be constrained by ongoing inventory adjustments.

Premium Ultra Mobiles

IDC predicts a 75% growth in the hybrid notebook-tablet market YoY in 2016. This may also help to enhance Windows' presence in the tablet market, the firm's analysts said.

Processors, MEMs, Semiconductors

Based on IC Insights, the strengthening of the US dollar vs the euro, yen, won and Taiwanese dollar has brought its toll on the semiconductor industry, deflating the sales growth rate by 3% and causing a 1% sales decline in contrast to 2014.

The total sales of the top 20 chip firms are forecast attain $259.15b in 2015, down less than 1% compared to the total of $260b in 2014.

The IC Insights report also indicates Samsung's continual growth, since it cuts into Intel's lead in the chip fabrication market. Intel's dependency on the PC market and its battle to break into mobile phones might find its semiconductor sales shrink 2% to just over $50bn for 2015, while Samsung's 10% growth in chip revenue now sits just $6bn behind.

Other movements of interest include Advanced Micro Devices (AMD) dropping from the top 20 chip sales for the first time in years with a 28% decline in 2015 sales to $4bn. Other notable losers in the 2015 ranking include Micron Technology, Qualcomm, Renesas and Toshiba.

Memory

The market oversupply continues to drive down the typical DRAM selling price. The move by manufacturers to reallocate production capacity from PC DRAM to server and mobile DRAMs has helped offset this problem, avoiding the worldwide industry from suffering significant revenue loss.

TrendForce reported the entire Q3 DRAM market revenue declined 1.2%, saved largely by the stable prices and higher margins of the server and mobile DRAM. Industry is reacting to these higher margins, whilst the firm also reported a growth in mobile DRAM's share of overall DRAM revenue from 33.7% in Q2 to 40% in Q3.

DRAMeXchange also reported how NAND flash revenue did not stick to the pattern in Q3. Macroeconomic factors leading to a surplus of stock and a price decline decreased speed of worldwide revenue to only 2.4% quarterly increase.

Storage

The private and entry-level storage (PELS) market continued its worldwide dip in Q3 with IDC reporting -13.4% shipments YoY to 16.7m units.

The only hope for industry originated from the 10.3% escalation in shipments in comparison to previous quarter. Shipment value also declined along with unit shipments, down -19.8% from a year ago to $1.3bn.

Personal storage dominated the PELS market, representing 98% of shipments. Of which 75% of shipments were 1TB & 2TB capacity points. 4TB and 8-20TB devices accounted for the majority of entry-level shipments.

IDC also noted that a static 2014 paved the way for the reduction this season, and noted the increased adoption of cloud storage in consumer space.

Western Digital (31.2% shipments), Seagate (25.9% shipments) and Toshiba (18.2% shipments) maintained their market share dominance, despite each facing significant negative growth (-18.3%, -9.8%, -12.1% respectively) in comparison to Q3 2014.

Meanwhile, PC vendors and channel distributions were conservative in SSD restocking efforts because of expected decreased notebook sales and expectations of falling NAND flash prices. Contract charges for mainstream PC-Client OEM SSDs also fell 10% for the fourth straight quarter, representing the 4th continuous quarterly decline of 10% or more.

Displays

WitsView (TrendForce) predicts the LCD panel industry's first ever annual shipment dip, estimating that 2015 shipments of 7inch and above LCD panels will reach 794m units for 2015, dropping 4.1% YoY.

On a lighter note, the television market provided critical support for large-size panels for shipment area, projected to grow 3.8% YoY in 2015.

Another bright patch for displays in the future could be the anticipated growth in 50+ inch TV panels from 48.7m units in 2015 to 55.4m 2016. The shift in 4K resolution will see it comprise nearly 40% of South Korean panel makers'TV product shipments.

Monitor panels were down 10.9% YoY for 2015 with shipments estimated to attain 142m units. WitsView said 2016 is looking to keep flat for the industry as product development moves its focus to in-plane switching (IPS) panels, which will be another adoption being driven by the South Korean makers.

While lengthy replacement cycles have stunted monitor demand, the shining light in this market could be the rising gaming segment. The growing gaming industry means upgrade demands will spur a growth of panels 27+ inch plus from 11.8m units in 2015 to 14m in 2016.

WitsView's latest data also highlights notebook panel shipments globally for this season will fall 8.7% YoY to 175m units.

IHS stated that worldwide currency issues are compounding flat demand for information technology (IT) panels. Driving down total unit shipments of large-area TFT LCD displays. Combined shipment area for displays used in PCs, notebooks and tablets is anticipated to decline 10% for 2015. TFT LCD TV panel unit shipments will increase by only 7% this year, and YoY TV panel’s area shipments will grow 9%.

Printers

Shipments of large format printers fell 4% YoY in Q3 2015, IDC said. Usually this is the slowest quarter in the wide format business, analysts stated, while shipments often rebound in Q4.

The worldwide 3D printer market is dynamic, based on Context Research, which reported shipments of 500,000 units since the product category's creation. The sub-$5000 desktop/personal printer market has increased shipments in the category up markedly in the few years. However, Q3 was weak, and industry is ripe for new entrants, it added.

 

Monthly Stats

 

New products reached a peaks and troughs without consistency throughout the month of November. Rising from 1 to 658 on 2nd November followed closely by another increase to the monthly high of 781 on 3rd November, the following weeks were all downhill to 146 on 15th November with a few minor highs and lows. Another increase to 528 on 17th November and immediate fall to 16th on 18th November was followed closely by a level until a rise to the next monthly high of 779 on 25th November. The remaining of the month finished with a decline of 200s before finishing up at 458.

Total price increases and decreases were equally sporadic, with sharp increases and dramatic falls throughout the month. Price increases saw a peak of 27914 on 9-10 November down to a low of 43 on 16th November with consistent fluctuations throughout, while decreases saw a monthly peak of 26,591 on 4th November and low of 15th on 16th November. Increases ended the month on 17,581 while decreases finished the month out at 7,102.

Total new parts were dominated by Microsoft, while Cisco had the best manufacturer price increases, and Zebra had the most price reductions.

Stock movement was anything but flat throughout the month with each segment reaching above 25,000 several times. Again, all dropped to just above zero on 16th November.

New Products November 2015

New Products Graph for November 2015

Prices and Stock Movements November 2015

Prices and Stock Movements Graph for November 2015

 

 



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