After HCL Infosystems’ exit from the PC Making business, it’s Wipro’s turn to beat a retreat from a margin diluting Personal Computer market.
The company which makes most of its money from the outsourcing business said (pdf)
After evaluating the changing market scenario and customer needs, it has decided to strengthen its position as a system integrator and increase its focus on IT solutions & services. As a consequence, the company will discontinue manufacturing of Wipro branded desktops, laptops & servers.
The $6.9 bn IT services company said that it will be in the PC market by providing “suitable brands” as a part of its solution offerings in large integrated deals.
Employees will be redeployed in the company and it will fulfill warrant & AMC obligations, said Wipro. According to Gartner, the Indian PC market grew 7.9% in the third quarter of 2013 in India. Sale was largely driven by Government contracts. With tablets cannibalizing personal computer sales & margins eroding, it doesn’t make sense of IT services companies to be in the PC making business which is not core to its growth anyway.