PC Industry Notches Another Weak Year Few Buyers Upgrading Customers aren't in rush to replace current PCs; 2002 sales grow just 2%.(A)

Byline: PATRICK SEITZ

It's deja vu for the personal computer industry. Just like at this time a year ago, analysts are saying PC sales should pick up in the third quarter.

Analysts say the sluggish economy is prompting companies to hold on to aging computers longer than usual. Two-thirds of PC sales are to commercial buyers.

Consumers aren't in any rush to buy new computers either. A PC that's a few years old works just fine for most needs.

PC companies are hoping that businesses and organizations that bought new personal computers more than three years ago because of Year 2000 compliance fears will upgrade soon. Analysts say the traditional three-year replacement cycle has grown to four years.

The problem for PC companies is that while chief information officers realize they should replace their old machines, chief financial officers are resisting, says Roger Kay, an analyst with market researcher International Data Corp.

"The CFOs are putting the kibosh on a lot of this stuff," he said. "At some point, you have to decide that your work force productivity is substantially less than it could be if your computers work at a tenth the speed of today's computers. A lot of the CIOs see that."