"There may well be restructuring in the consumer market as SARS progresses," said Kitty Fok, vice-president of central research group with market researcher International Data Corporation's Asia-Pacific team.

The traditional dominant force -- the white box and clone computer makers -- will suffer heavily from the SARS outbreak, said Fok.

The US-headquartered research firm said in a report that this could have significant consequences for consumer, the education system and government in China, the traditional strongholds of small vendors or so-called white box makers as well as Do-It-Yourself (DIY) or clone shops.

"These vendors will have more pressure put on them than the bigger brands due to their small scale and lack of alternative sales channels," said Shen Lin, computing research manager with IDC China.

More than a half of the stalls in Hailong Building, Beijing's biggest computer marketplace, closed for 15 days during the Labor Day holiday instead of the official five days due to the SARS outbreak.

Another marketplace, Silicon Valley Computer City, cuts its opening hours to five hours from eight hours a day.

It is estimated that these vendors contribute to about 40 per cent of country's annual PC sales.

More than 11.26 million computers were sold in the world's most populous market last year, IDC statistics show.

At the same time, major domestic PC makers have stepped up their efforts since April in developing consumer market with online and telephone sales.

China's largest computer maker Legend Group said its sales of personal computers during the Labor Day holiday rose by 25 per cent over the same period last year.

The third biggest domestic PC firm, Tsinghua Tongfang, also reported that its shipments of computers during Labor Day increased by 50 per cent, as many people began to work at home and students participated in online classes.

While companies like Legend are gaining in the consumer market, Langchao Beijing Information Industry Co Ltd, another major domestic player, cast its eyes on the computer market for Internet cafes.

"The pie white box and DIY vendors will be smaller and smaller with more big players coming this year," said Huang Gang, Langchao PC general manager.

He estimated that white box and DIY computers account for more than 90 per cent of computers used in Internet cafes in China.

However, with the Chinese Government's encouragement of chain Internet cafes, their owners will choose more products made by brand-name makers for after-sales services and solutions such as hardware configuration and network deployment.

Huang said his company had won an order for 5,000 computers from the country's only full-service telecom operator China Unicom's Anhui Province branch for its Internet cafe chain in the province.

He added that the target for Langchao this year would be 100,000 units.

(China Daily May 29, 2003)