While notebook PCs have received all the attention over the past few quarters, desktop systems aren't dead yet – with faster-than-expected sales expected to lift the desktop market, according to IDC data.

Worldwide shipments of PCs are now expected to increase 13.5 per cent for 2004, up from expectations of 11.4 per cent growth released by IDC in March.

In the first quarter, desktop shipments increased 13.4 per cent as compared to the first quarter of 2003. The category grew only 9.4 per cent in the fourth quarter of 2003, compared to the previous year's fourth quarter. The fourth quarter is considered the strongest period for PC shipments, while the first quarter is historically much slower.

Desktop PCs account for over 70 per cent of all PC shipments worldwide, IDC said. Any notable increase in shipment growth for desktops will have a substantial effect on the overall market.

As business customers start purchasing PCs in greater numbers, they are choosing desktops more than IDC had expected, said Loren Loverde, director of IDC's worldwide quarterly PC tracker. The strong growth in notebooks over the second half of 2003 had led many analysts to predict businesses would replace their aging desktops with notebooks, but cost pressures continue to affect business PC purchases, he said. Notebook PCs are generally more expensive that comparable desktop PCs.

Notebook growth was still strong at 28.5 per cent in the first quarter, IDC said. But notebooks grew at a 35 per cent clip in the second half of 2003, showing that buyers are becoming more price sensitive and selective when it comes to notebook PCs, IDC said.

Businesses are buying notebooks, but they are selectively rolling them out to their users rather than opting for a wholesale replacement of their desktop infrastructure, Loverde said.

Western Europe and Asia-Pacific are expected to lead the growth around the world throughout 2004 as those regions begin to replace aging PCs. That replacement cycle has already begun in the US, but should remain strong during the rest of the year, IDC said.

The value of PC shipments is also expected to grow in 2004, but at a slower rate as the industry continues to mature. Total shipment value for 2004 is expected to be $194.5 billion, an increase of 9.2 per cent from 2003.