With Senator Kim Carr, Minister for Information, Industry, Science and Research, calling for no less than a “digital educational revolution”, notebook vendors in the education space are bracing themselves for a substantial increase in sales over the next few years.
While some of the $1 billion the Federal Government digital education revolution fund is targeted towards Internet connectivity, the bulk of the funds will be spent on laptop or portable computers for the country‟s million senior school students.
The Federal Government is refusing to confirm numbers until the completion of an education sector IT audit currently taking place around the country. Nonetheless discussions within the Senate estimates committee which met to review the project on February 20, suggested approximately 700,000 laptop computers would be needed in order for the Government to deliver on its election promises.
This would result in a doubling of demand for laptops in a market already growing apace.
“For the whole of 2007, there were a little under 1.9 million laptops shipped into the Australian market,” observed Liam Gunson, program manager of hardware research for IT analyst group IDC. “Year on year growth rate in the most recent quarter was 31.1 percent; we have to go back and redo the figures for 2008, taking into account what the Government is doing. It will certainly be a substantial increase, but at this stage we don‟t have enough details to predict by how much.”
While analyst groups like IDC are tweaking their predictions to include the Government‟s plan, vendors are describing the challenge of a sudden increase in demand as a „nice problem to have‟, and are already working with their customer base to update 2008 forecasts.
“Although it‟s a big increase within Australia, in term of worldwide shipments we will have the resources to procure the products,” offered Frank Ugolini, Acer national education sales manager. “We‟re also able to double the capacity of our final assembly plant in Australia, to put the final touches on the machines.”
For its part, Lenovo is calling on resellers to be proactive in feeding education sales queries back through to the vendor, so as to ensure supply can be procured in a timely manner.
“It will all come back to good forecasting and maintaining good relationships with our customer base,” offered a spokeswoman for Lenovo. “We‟re already very involved at the school level, because it‟s not just about giving them a product list; it‟s about creating a IT plan which will run for a number of years.”
With the funds to be distributed at a state level, it would seem the winners will be existing education suppliers. The eastern states have not indicated any change to their existing supply arrangements, while both Western Australia and South Australia have confirmed their intention to spend the extra funds through current suppliers.
However, PC retailers may be less enthusiastic, as the increased expenditure in government schools is expected to have a slight, but negative, effect on retail sales of laptops.
“There might be small flow-on effect to the retail market, where people who might have bought their kids a laptop for school would put off that purchase because of the government‟s decision,” Ugolini said.