Shipment volume of the Greater China notebook PC industry reached approximately 34.4 million units in the first quarter of 2014, down 14% sequentially and 5.1% year-on-year, according to MIC. Notwithstanding, the industry's shipment volume decline rate in the first quarter is lower than previously expected at around 20%. The slowdown in sequential decline is mainly attributed to the growing demand for commercial notebook PCs.

Compared to the past years where consumer models constitute for the largest share of total notebook PC shipments, it is no longer the case since the first quarter of 2014 when Microsoft terminated the support for Windows XP in April 2014. While taking the safety into consideration, most enterprises have been keen on upgrading their hardware devices to support new software. As the result, the replacement demand for commercial notebook PCs unleashed in the second half of 2013 and continued well into the first quarter of 2014. The industry's decline slows down in the first quarter of 2014, mainly as a consequence of the increased share of commercial notebook PCs which has offset the shrinking demand for consumer models because of tablets.

Greater China Notebook PC Shipment Volume, 2Q 2012 - 1Q 2015

Source: MIC, July 2014

Future Development of Chromebooks in the Consumer Market Remains to be Seen

After Chromebooks have obtained a significant share in the North American educational market, more vendors have been keen on developing their own Chromebooks. In the past, only Samsung and Acer set foot in Chromebooks. In 2014, more branded vendors including Toshiba, ASUS, HP, Acer and Samsung have unveiled their interest in Chromebook and have their respective models in the launch pipeline. This is expected to further broaden the Chromebook's market share. Besides, in order to speed up adoption of Chromebooks, Google has been investing in product promotions and training and educations for school teachers while subsidizing branded vendors in order to enhance price advantages of their Chromebooks.

As almost all major branded vendors have invested in the development of Chromebooks, Chrome OS has been known widely. Therefore, Google is set to place more resources on the development of Chrome OS applications addressing on needs of the commercial sector instead of providing subsidies for Chromebooks. In 2014, the prices of Chromebooks will see an uptake. Meanwhile, Google's targeted customers are shifting to the commercial sector, and the company is expected to reduce funds allocated for promotional activities in the consumer sector. As there is a learning curve involved in running apps in the cloud with Chrome OS, whether Chromebooks will appeal to the masses in the consumer market remain to be seen.

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About MIC

Market Intelligence & Consulting Institute (MIC), based in Taipei, Taiwan, was founded in 1987. MIC is Taiwan's premier IT industry research and consulting firm providing intelligence, in-depth analysis, and strategic consulting services on global IT product and technology trends, focusing on markets and industries in Asia-Pacific. MIC is part of the Institute for Information Industry. https://mic.iii.org.tw/english