Analyst warns of rising PC and laptop prices

Vendors including Lenovo, HP and Dell are expected to raise prices

New research has warned companies to expect a sharp rise in the cost of new desktops and notebooks.

Analyst firm Context said that increasing component costs have forced PC vendors, such as Lenovo, HP and Dell, to raise prices.

Context explained that component manufacturers scaled back production and investment during the downturn as a matter of caution, and have been looking for ways to make up the loss for the past six months.

The research shows that component costs for notebooks fell by over nine per cent in the first seven months of 2009, but rose by more than four per cent up to the end of January 2010.

"We have seen an increase in market prices, and we expect this to possibly continue for a bit longer," said Context pricing analyst Mathias Knoefel.

Knoefel explained that vendors had kept contract prices low in an attempt to appeal to business accounts, but are now under pressure not to lose more money on the deals.

"We have seen vendors trying to increase the negotiated price with buyers during the tender process for two- or three-year deals," said Knoefel.

Entry level prices in the consumer space have remained stable, Context said, but device functionality is unlikely to be extended at the same pace.

Many consumers have been willing to pay more for multi-touch all-in-one systems, according to the report, and many PC vendors will be using the higher profit margins on such products to make up for shortfalls elsewhere.