German desktop market returned to double-digit growth in 2004.

According to IDC final data, the total German PC market reported growth of 15.6% in the second quarter of 2004 over the same quarter last year. The commercial desktop market also recorded a strong performance of 15.6% growth year on year, assisted by increased IT spending in the enterprise market. The corporate market rebounded earlier than expected, reporting 18.4% growth year on year but the SMB segment continued to report the highest volume shipments of over half a million, recording an annual growth of nearly 15%. Corporate growth was stimulated by renewals (installed base over four years old) and the need to upgrade to Windows XP.

The consumer desktop market was also able to regain momentum this quarter compared to the weak performance witnessed over the past three years. The market reported growth of 3.60% year on year thanks to new attractive digital entertainment bundles, Windows Media Center, and gaming. Consumer demand is driven by high-feature machines at very attractive prices and the market is now able to offer such products.

The notebook market maintained robust growth of 25.6% yew on year, but showed a slight slowdown from the previous five quarters. In the first half of the year more than 1.3 million portables were shipped across the consumer and commercial segments, with aggressive marketing campaigns, low entry-level notebooks, and good product specifications all key to success in mobility. International and local vendors continue to offer the right product at very aggressive prices and it is becoming a challenge to maintain margin and share. The consumer portable market recorded 20% annual growth, driven by aggressive marketing campaigns and price declines. Acer continues to report outstanding growth of 100% year on year, increasing its presence in the retail market. In the commercial space the notebook market reported an annual growth of 30.5%, aided by continuous demand in the SMB space. The x86 server market recorded 21.8% growth year on year, just below IDC expectations. The corporate market reported the highest growth, at 26%, compared to 19% in the SMB market. The top 4 vendors--HP, FSC, Dell and IBM--continue to report strong results in the x86 server market by securing important deals. Vendor Performance Highlights--The leader in the total PC market, Fujitsu Siemens, gained 1.5% share in the overall PC market. In the commercial desktop market Fujitsu Siemens continues to lead with 18.9% growth year on year, assisted by the continuous focus on SMBs as well as benefiting from increased IT spending in the corporate market In the notebook market, Fujitsu Siemens' continuous focus on mobility enabled it to record annual growth of 39. 1%, ranking it in second place continuous focus on SMBs as well as benefiting from increased IT spending in the corporate market In the notebook market, Fujitsu Siemens' continuous focus on mobility enabled it to record annual growth of 39. 1%, ranking it in second place.

* HPretains second place in the overall ranking and reported an annual increase of 5.7%. However, it was not able to maintain the same level of growth registered in the first quarter of the year (33.7%). HP suffered from price competition in the consumer market in both desktops and notebooks- Nonetheless, it was able to sustain growth in the commercial space. In the x86 server market, HP maintains its leadership, with more than 37% share and annual growth of 29.4%.

* Medion continues to perform very strongly in both desktops and notebooks and remains a key competitor in the consumer desktop space, maintaining its leadership.

* In the overall notebook market Acer continues to lead with a 15.3% share, reporting an increase of over 100% year on year. The vendor's strategy is unchanged--continuing to be aggressive on price and able to effectively fulfill channel demand. In the desktop market, Acer is also gaining market share and position, becoming a fierce competitor in the SMB segment.

* Dell reported overall growth of 23.5% year on year and continues to execute well and gain presence in the consumer and SMB space. It reported more than 20% growth across all three product lines.

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