Look for 1995 to be another growth year for computers and business equipment, including cellular telephones. But processors should not count on their margins getting any better. Word from major original equipment manufacturers is that although the numbers will grow, there will be continued pressure on pricing and quality, with reduced lead times.
``The downward spiral of prices will continue to carry on into this year,'' said Jenni Ceurzels, an industry analyst with BIS Strategic Decisions in Norwell, Mass.
Most of the price decreases will be seen in the portable personal computer lines, while desktops should remain the same.
Ceurzels also said portables will continue to get smaller and lighter, which means less raw material in the units, but analysts project total PC shipments will increase by 12 percent in 1995 over last year.
Robert Corpuz, PC industry analyst for Dataquest Inc. of San Jose, Calif., said the PC market saw ``very healthy unit growth'' in 1994 of 21.2 percent in the United States and 19.8 percent worldwide. He predicts that the trend will continue, with the U.S. home computer market driving sales.
Corpuz said the largest percentage increase in industry sales will come from the sub-notebooks, which act like a standard notebook computer but weigh less than 4 pounds and contain no internal floppy drive.
Stratification in the computer industry has made life good and bad for the top four computer makers: Compaq, IBM, Apple and Packard Bell. These industry leaders, Corpuz said, will continue to refine their products and respond to competitive pricing as they pull away from the pack.
Corpuz advises that the three companies to watch in 1995 will be Digital Equipment Corp., Hewlett-Packard and Acer America Corp. Both Digital and Acer sit outside the top 10 computer OEM listing, but that is expected to change this year.
``There will definitely be an increase in unit shipments in 1995 for these companies,'' he said.
In fact, some analysts expect DEC to double its shipments of PC units to 1 million, as that company seeks market share with a new line of IBM-compatible desktops and notebook PCs.
Telecommunications continues to be a strong area, especially in markets such as China and Mexico, where a lack of hardware infrastructure makes cellular phones the optimum method of communication. Molders for this segment report increased orders from most of the major OEMs such as Motorola and Nokia.