Category Archives: IT Pricing

CONTEXT Brings Specialist IT Channel Insight to Argentina

At CONTEXT we’re constantly striving to bring insight and actionable market intelligence to the IT channel. Over the past three decades that central mission has seen us expand into 16 Western European countries, and even further afield: to Russia, Dubai, Japan and Brazil. We’re delighted to be taking the next step of our journey in South America by launching the first ever distributor panel in Argentina. It’s been a tough year for the channel there so far, but this is an opportune moment to offer CONTEXT’s unique market analysis, so that channel organisations can make crucial business decisions with greater confidence going forward. Continue reading

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Eurozone Blues

1999 was a momentous year for CONTEXT. Not only were we facing the Y2K bug, but at midnight on 1 January 1999, the national currencies of participating countries in Europe, aka the Eurozone, ceased to exist independently. Their exchange rates were locked at fixed rates against each other.

By then we had built up a pretty successful pan-European price tracking and comparison service, PriceWatch. It had depended for years on our ability to monitor prices and VAT rates across different countries and currencies thus enabling customers to perform apples to apples comparisons across a huge swathe of IT products, from desktops to printers to displays.

The service started in the late ’80’s thanks to a chance comment from Unisys: was there anything we could do about tracking prices as the work involved was causing them a headache? We obliged, and started turning out huge folders, updated monthly, filled with pages of indexed specifications and prices, which then graduated into – gasp – an accompanying 3.5” floppy with the data in digital form. Many a CONTEXT old-timer will remember the wrapping and binder duty into the late hours of the night to meet deadlines.

The big question we faced was this: with the introduction of the Euro, was that the death knell for our European Pricing Service? The pundits said yes. Why would any manufacturer pay for data on prices when transparency was assured thanks to the common currency?

Of course, we need not have worried. In fact, if truth be told, the manoeuvring by vendors attempting to rationalise VAT rates and prevent grey market activity gave us more work than ever before.  The PriceWatch service grew, and is now an extremely successful component of the suite of information products we provide today across the globe.

by JD

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Is distribution dead?

Distribution is dead? The provocative catch phrase spoken by CEO of the GTDC – Tim Curran in his opening speech at the recent inaugural GTDC APAC meeting in Singapore.

It was clear by the end of Tim’s presentation that the state of distribution is quite the contrary and that distribution is thriving more than ever before. He spoke of the continued acceleration in the advancement of technology, the shift towards Cloud and the as-a-service model bringing with it annuity income and a host of different opportunities; that value-added services now define distribution and simple box moving is not enough anymore. It was like a group of paparazzi had descended on the room when Tim presented his slide on over 42 value added services that distributors can and should have in their repertoire.

The event was attended by senior executives from major regional distributors including: SiS, Innovix, Ingram Micro, Westcon-Comstor, TechData, Arrow ECS, Synnex & Compuage Infocom with many of the top Vendor brands present there too. There was no shortage of discussions, interest and a willingness to learn and share information and experiences.

GTDC_APAC-Recap-Page_Gropu-Photo2

I think that most attending would agree that the panel discussion hosted by Peter van den Berg (GM GTDC EMEA & APAC) was a highlight, senior executives from Compuage Infocom, Huawei, Ingram Micro, Red Hat and Westcon-Comstor commented on the most common misunderstandings between distributors and vendors and how to minimize pain points.

The group’s agreement covered the following important points:

  • The Enterprise space is growing at a rapid rate and vendors are asking distribution to do more,
  • End point device distribution is still important but more so the pre-sales, post-sales and training offerings provided,
  • The 2-tier distribution model is under immense pressure and traditional IT resellers need to adapt to survive – therefore enablement & training is key whilst also looking to new partners and how to better serve them.

It was the first GTDC APAC summit – CONTEXT is proud to have been associated with the event, and we look forward to many more, and to the growth of the GTDC presence in this region.

by CV

 

 

 

 

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Why using the right type of Analytics is the most important factor in gaining true insight

Everyone in the market research industry knows that we’re drowning in data. But the mere fact that there is lots of it, doesn’t necessarily mean it’s more useful than back in 2013 when there was only about 1/8th of today’s total available amount [1]. The key is whether that data is A. ‘analysable’ (i.e. databased, processed, categorised and readily available), and B. analysed well. Continue reading

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35 Years and counting… stories from the IT frontline

To mark CONTEXT’s 35th year anniversary, co-founder and CEO Jeremy Davies reflects on the state of computing during the early days at CONTEXT.

Starting a small business means adapting your needs to serious budgetary constraints. You need that 20MB hard drive, but can you afford it?

Towards the end of the 1980’s, the PC revolution was in full swing, but computers were not cheap. IBM’s PC came in at around £3,000 in those days, equivalent to £6,300 in today’s value. Margins were high double digits compared to today’s meagre low single points. At one point it is said that UK Apple dealers were making so much money, the Cupertino company asked them to stop the ostentatious displays of wealth and invest in their businesses. Continue reading

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35 Years and counting… stories from the IT frontline

To mark CONTEXT’s 35th year anniversary, co-founder and CEO Jeremy Davies reflects on the early days of the IT industry and the beginnings of CONTEXT.

It’s now 35 years since CONTEXT began tracking the IT business. That’s quite a thought in itself. The fact that we have been able to create a business from scratch and – despite all odds – still be here, thriving, 35 years later.

But what’s even more stunning is to have been a witness to the changes that have taken place since those pioneer PC days. And what has kept us in business has been that change: not only have we watched it but we lived it, taking an active part as a small and growing business, embracing the latest technology as it unfurled and integrating the new as we built the platforms and processes needed to track the burgeoning IT industry.

So, a few facts to illustrate. In the 1980’s, magazines were king. Vendors advertised in Magazinemagazines, prices, specifications and even dealer lists. To track prices, one had to track magazines. This intensely manual job resulted in output that every month saw huge physical printed files sent out to subscribing customers. If you wanted to know specs and pricing, you opened a folder and leafed through pages of printed text. A huge step forward was achieved when data files began to accompany the printed “books”.

Surveying dealers was another challenge. To create our master dealer list in the UK, we got hold of the Yellow Pages directory, and telephoned every entry that had the word “computer” in it. We asked three simple questions: Do you sell microcomputers? Which ones do you sell? Which ones are you authorised to sell?The calls were done by a dedicated in-house team who, after building the list, started contacting resellers every two months, asking for sales figures. These were manually entered into paper spreadsheets, and the calculations done – you got it, manually. Printed reports then appeared every two months detailing these aggregated and projected sales of PCs, Printers and Software.

This is not to say there were no computers involved from the beginning. There was one. It was an Osborne 1 portable computer, running CP/M on a 4.0 MHz Zilog Z80 processor and 64 KB of RAM. Twin 5.25” floppies and a 5” screen completed the picture. As work volumes grew, we invested in our first IBM twin floppy PC. And then came hard disk drives… but that’s another story!

CONTEXTKensingtonoffice

CONTEXT’s first office was at 9-11 Kensington High Street, which is now a hotel

 

 

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Q2 Round-up: New iPad Launch Softens Consumer Slate Sales Slump

With unrivalled insight into the Western Europe ICT supply chain, CONTEXT has been following with interest the evolution of the PC and mobile computing market. In many ways, Q2 saw a continuation of trends, with PC volume sales continuing to fall and consumer tablet demand remaining weak as buyers divert their spending to smartphones.

However, as always, there were some interesting caveats behind the headline statistics, not least the impressive performance of the new iPad launched in March.

Tablets and detachables
It’s true that overall consumer tablet demand remained weak during the second quarter. Shoppers continued to shift their budgets to other technologies that have come to represent the content consumption devices of choice in this market segment. Larger screened smartphones in particular have become popular for activities like writing emails and using apps as they’re always on and close-at-hand for consumers.

However, year-on-year volume decline was softened somewhat thanks to the launch in March of Apple’s seventh generation iPad. The 9.7in tablet is more powerful than the iPad Air 2 but also heavier and lacking several of the latter’s features such as a Smart Connector, and fully laminated, anti-reflective screen. However, its relatively low-price tag seems to have attracted consumers in large numbers and it sold well in Q2.

This is not unusual for Apple products, which often see strong initial sales. But if consumers continue to flock to the model, it would seem to suggest there’s a need for a high-quality iPad option with a price point more in line with current market trends.

Elsewhere, business detachables continued to grow year-on-year in Q2, dominated by Apple and Microsoft products but with Lenovo making impressive inroads. New products such as Apple’s iPad Pro with a 10.5in screen and Microsoft’s fifth generation Surface Pro helped drive this growth. Business detachables still aren’t selling in huge volumes, but it was one of the few segments to post growth in the quarter.

PC Average Selling Prices continue to rise
On the face of it, the PC market overall saw a bigger than expected drop of -15% year-on-year in terms of volume sales. However, there’s more to this trend than meets the eye. For one, Q2 2017 had fewer trading days than the same period last year and some April sales had been brought forward to March in anticipation of rising prices.

Despite weak demand in some segments, the quarter fared better from a revenue perspective, down just -2% year-on-year as average selling prices (ASPs) continued to rise. The growth in ASPs year-on-year continues to be driven by a blend of currency, component costs and a richer product mix; with the shift to high-end models a welcome continued trend.

Weaker-than-expected sell-through meant that inventory levels are a bit higher than desired, but not worryingly so. It’s likely that the “back-to-school” period will be used to get rid of extra stock, driving a reduction in pricing quarter-on-quarter.

by MCP

 

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