NEXT
Tablets Pass PCs in Buying Cycle; Cloud Could Carry New Round Sunday, May 29, 2011
Solarflare server adapter: company looking to new products
Memory products maker Kingston Technology Co. wasted little time trimming its sails after racking up a record $6.5 billion in revenue last year, a 59% increase.
Fountain Valley-based Kingston recently said it’s “extremely unlikely” to match last year’s revenue.
The main reason: an oversupply of memory products that has dragged prices down by about half.
Kingston’s not alone in reassessing the market as the buying cycle for technology products nears what appears to be a peak.
Total spending on technology is expected to grow 5.6% to $3.6 trillion worldwide this year, according to Stamford, Conn.-based researcher Gartner Inc.
Gartner recently revised its estimate up from a projection of 5.1%.
The upward revision is attributed entirely to growing sales of tablet computers, part of the mobile segment.
Shipments of PCs dropped by 1.1% in the first quarter, according to Gartner.
Kingston and others are looking to the mobile segment to pick up slack left by PCs.
Some believe mobile devices could spur demand for a new generation of thinner, lighter memory components, extending the current tech buying cycle for the next three to five years.
“In the future, we may see memory or flash memory, instead of being on modules, applied directly on the motherboards,” said Al Soni, senior vice president of strategic alliances for Kingston. “That is a possibility.”
Most mobile devices require less memory than PCs, meaning they need fewer of the core products of companies such as Kingston.
“All (people) use these things for are e-mail, Internet, photos, etc., so for many millions of users an iPad is perfectly good,” Soni said.
Tablets
Big sales of tablets look to be a key to offsetting declines in PC sales.
Framingham, Mass.-based researcher IDC recently reported that tablet sales rose from 4.5 million units shipped in the third quarter to 10.1 million units in the fourth quarter.
Tablets, phones and other mobile devices appear to have room for exponential growth that would bring sales of 100 million or more units in the next several years.
“Apple has set up a new model in the PC industry,” Soni said. “They’re involved in notebooks, tablets, and smartphones. Companies like HP, Dell, Acer … everybody has to reinvent themselves and that creates another opportunity for Kingston.”
While mobile devices and PCs swap spots in the buying cycle, cloud computing holds the potential to touch off a new one.
The Cloud
Cloud computing refers to a network of remote servers hosted on the Internet to store, manage and process data.
Page 1 of 2
Prev Next
