Users could be offered bargain PCs in the coming months as motherboard vendors start clearing their inventories to prepare for the launch of Vista next year.
Investment banking company Goldman Sachs said that demand for desktop PC motherboards "is falling off a cliff" in late October. Motherboard orders for the desktop PC market has slid nearly 20 percent from its early October peak.
"Motherboard demand weakness is in line with our view that Vista has a negative impact on (fourth quarter) motherboard demand, but it happened earlier and more significantly than we expected," said Henry King, executive director of technology research for Goldman Sachs (Asia).
Rising user demand for laptop computers is also pushing demand for desktop motherboards down, he said.
As motherboards and other desktop PC components pile up at the end of October and in November, King believes companies will start a price war to clear their inventories.
The laptop PC sector is also facing some trouble. Strong user demand for laptop PCs is causing a shortage of components, King said.
Acer executives said they expected to be able to procure only 95 percent of the components they need to sell laptop PCs in the fourth quarter, which is the peak season due to year-end holidays.
"Since the second half of August, we've seen demand rush in. We can't fill all our [laptop] orders," said Gianfranco Lanci, president of Acer. The world's fourth largest PC vendor expects a short supply of laptop batteries as well as microprocessors.
A massive recall of laptop batteries by major PC vendors such as Dell and Apple Computer has caused a shortage of batteries because it comes at the time of peak laptop demand for the year. The recall was due to defective Sony parts that can cause the batteries to overheat and possibly catch fire. Sony expects the recall to total around 9.6 million batteries.
Original reporting by IDG news service