"Windows 10, due to release in the third quarter this year, has been given a mission to regain Microsoft's consumer market share," says Charles Chou, senior industry analyst with MIC. "However, as the last wave of replacement demand just ended in 2014 and the fact that Windows 10 will be a free upgrade for Windows 7 and Windows 8 users, the newly released OS' contribution to the global PC market is likely to be refrained, especially desktop PCs which have a dominate share in the commercial market."

MIC estimates the global desktop PC market volume will reach around 120 million units in 2014, down 9% year-on-year. Likewise, the global notebook PC market will decline 2.7% year-on-year to around 167 million units in 2015, affected mainly by the cannibalization of tablets and the Microsoft's changes in subsidy policies.

China's Increased Capacity

MIC predicts that Taiwanese notebook PC shipment volume will pose around 139 million units in 2015, down 5% year-on-year, while desktop PC shipments will dip 17.1% year-on-year to 56 million units. "Affected by the capacity released by Chinese LCFC and Lenovo's order adjustment, Taiwanese notebook PC makers' global share will continue to decline further this year."

Two-in-ones

MIC forecasts that global tablet market volume will reach around 214 million units, down 11.5% year-on-year. The market development has been mainly affected by the growing screen sizes of smartphones. Over the years, the declining tablet prices have pushed them into the saturation zone, thereby forcing many white-box vendors out of the market. Most branded vendors therefore have been turning to two-in-ones.

Amid the lukewarm tablet performance, the global two-in-one tablet market is forecast to grow at 62.5% to 13 million units in 2015 compared to 2014. Two-in-one tablet ASP is US$400, which is doubled that of traditional tablets running on ARM-architecture and Android OS. The relatively high assembly difficulties associated with two-in-ones have made Taiwanese manufacturers more competitive than Chinese counterparts who already have a dominant share in low-cost tablets. Taiwanese tablet shipments are expected to hit around 80 million units in 2015.

Positive Outlook for Servers

In the server industry, fuelled by the rising demand for datacenters resulted from increasing public and private cloud services, MIC estimates the global server market volume will top around 10 million units in 2015, up 6.7% year-on-year. In the same year, Taiwan will ship approximately 80 million servers and server motherboards, up 1.2% year-on-year.

"Datacenters bypassing server brands to place orders with Taiwanese server makers has become a common pattern," says Chou. "The increasing amount of orders placed by datacenters for Taiwanese makers is going to have an adverse impact on their partnerships with server brands. And the effects could be profound if there are huge variations in all aspects of Taiwanese makers, including sources of revenue, product form factors, and business models."