Channel faces retail overkill: IDC

Channel faces retail overkill: IDC

IDC has predicted the channel is heading for a plethora of retail activity in the wake of decisions by Coles Myer and Hewlett-Packard to overhaul their retail distribution models.

IDC's Bernie Esner said in the company's weekly news summary IDC Pulse on Friday that international chains could suffer the most from increased retail competition.

"If one applies a current channel map of the PC market at the retail end, I predict we are heading for a total 'retail overkill' and there will be blood on the streets," Esner claimed.

"It may not be the local 'Mums and Dads' stores or unbranded PCs that suffer the most, though. I think that some of the international chains would do well to watch the situation carefully."

Coles Myer and Hewlett-Packard are both realigning their retail business strategies. Coles Myer subsidiary Harris Technology is set to become a major retail IT player, if a pilot plan to establish its own "kiosk" at two Kmart stores takes off. HP distributor Prion is expanding its reseller network, which will see the HP Pavilion range in retail chains such as Chandlers.

The announcements follow recent channel moves by Compaq, Apple, Acer, Packard Bell, Optus and Strathfield Car Radio.

"The channels are in a state of upheaval," Esner said. "This massive shift in PC distribution is the beginning -- or perhaps a continuation -- of a major shake-out of the PC industry. We can expect to see a few fortunes exchanged along the way."

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