So when will NEC stop making PCs?

Lehmans analyst forecasts withdrawal

Lehmans Brothers analyst Scott Foster has a bee in his bonnet about NEC's PC operations. He reckons the company will withdraw from PC manufacture - even though it has the biggest market share of all in Japan, the world's second biggest market, with over 20 per cent of sales. (Of course NEC used to have more than 50 per cent of the Japanese market with its own proprietary and very expensive PCs).

Why does he think this? We don't know the answer, but we guess it's because lack of success outside Japan means that it cannot command the same economies of scale as its global rivals. And now it can't even make money in its home market, according to an interesting FT article (which reports Foster's NEC prediction) about the Japanese PC market.

Traditionally Japanese PC makers commanded top dollar for feature-packed boxes - now those cosy assumptions are under threat from the likes of Dell and new local player Sotec, which are undercutting the establishment on price - and in the process torching their profits, and at a time of rising PC sales.

Japanese PC makers appear to be abandoning the global market, JP Morgan analyst Hideki Wakabayashi tells the FT. We're not sure whether Fujitsu Siemens would agree with this. The Japanese/German JV PC maker may be weak in the US, but it is a strong player, and especially in Europe, just about everywhere else. ®

PC Headaches hit Japan

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