Also looks to diversify as whitebox dips

Also looks to diversify as whitebox dips

Reports of a slowing in the whitebox market have been given credence by specialist distributor and whitebox systems integrator, Also Technology. The company has reported a 40 per cent dip in unbranded systems sales this quarter and is not optimistic about the prospects of seeing this change any time soon.

"Normally, we would sell 600-800 PCs a month but we are only doing about 60 per cent of that at the moment," Also sales manager, Kent Lee, said.

Despite the well-publicised shortage of CPUs hurting whitebox players, Lee said increased competition for smaller tenders was more to blame for the demand shortage.

"There are many providers in this space and the Government has been very tight with its budget," he said. "Normally they would have bought earlier - a month or two before the end of the financial year."

Greater competition from the likes of Dell and Acer was also resulting in increased pressure, Lee said.

"Those companies with their low price points have really taken share," Lee said. "Companies like Dell are doing free upgrades that would cost us another $100 and, because of their size and volumes, they can out-compete with their delivery structure too."

Concurring with this dim view, IDC PC and hardware analyst, Michael Sager, said the whitebox market was under siege from many directions. "The desktop PC market is being eaten on two sides by the growth in notebook PCs and thin client devices, thereby decreasing their overall potential market," he said.

"Multinational vendors such as Dell and Acer will have to focus on competing with whitebox vendors as they have 50 per cent of the market and multinationals need to grow somewhere."

Forecasting low desktop sales until October, Also had looked to increase peripherals, digital camera and notebooks sales, Lee said. It had also begun moving into the security market.

"We are not changing direction, but part of our customer base focuses on security so we are doing more things like combining IP cameras with our whitebox servers," he said. "This way we have been able to gain close to a 100 per cent increase in our server sales."

With whitebox PCs fast enough to run all current applications, Lee said, the community would have to wait until new applications or demand for 64-bit computing saw a reigniting of the PC refresh cycle.

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