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Vista delay causes motherboard pile-up

Bargains ahead as demand sinks to new low

Sales of motherboards used in desktop PCs continue to decline ahead of the launch of Windows Vista, a sign that could foretell bargains for users in coming months.

Slowing demand from PC users ahead of the release of the much delayed OS (operating system) - set to hit the shops in January - is the main culprit for falling motherboard sales, while shortages of key components such as low-end microprocessors are also a factor, said Henry King, executive director of technology research for Goldman Sachs (Asia).

He further revised down his motherboard shipment target ahead of the important Christmas season, with October shipments likely to be 6 percent lower than those in September.

"This would be the worst [fourth quarter] we have seen since we started to track motherboard data in 1999," said King.

As motherboard inventories pile up, King believes a price war will begin. "Our supply-chain checks indicate that both inventory build-up and price competition are imminent," he said.

Unlike desktops, demand for laptop computers remains strong, he said. Goldman Sachs also believes Vista will boost PC sales over the next few years. In the near term, however, users are shying away from new purchases in the months leading up to the launch of the new OS.


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