SINGAPORE--China's population differs in education, buying power and spending habits so it would be a mistake for hardware vendors to regard the country as one undivided market.

"Don't generalize the entire country," said Bryan Ma, IDC Asia-Pacific research manager (Personal Systems). Hardware vendors which understand how various regions differ can tailor strategies to meet each market's need, Ma said.

Large corporations based in China's northern and eastern regions have helped Intel-based computers grab the top spot but in the more price-sensitive and poorer west and central regions, Do-It-Yourself "white boxes" with cheaper AMD processors are popular, he told participants here Friday at the research firm's yearly conference, entitled "Directions 2002: IT Leadership for the Rebound."

In the wealthy south, monthly incomes are US$110, compared with just US$65 in the poorest west. Southern PC buyers are heavily influenced by trends in neighboring Hong Kong, favoring cool designs and more powerful options. Vendors should also note that the Chinese government is encouraging resettlement from the east and north to the sparsely populated western regions, Ma said.

Overall, the China market for PC sales will continue to grow, driven by its huge population, increased investments in IT from the Chinese government and the private sector, as well as education programs. Shipments will reach 13 million units next year and increase to about 21 million by 2006, Ma said, but was quick to warn that the boom can't be sustained.

"While the growth in PC shipments is forecasted to hit 25 percent next year, by 2006, the growth rate will slow to 15 percent due to the effects of market maturity and component supply instability," he said.

Worse news for Western PC makers is the continued success of homegrown brands such as Legend, Tongfang and Founder. In 2001, all non-domestic brands but one either lost market share or saw flat growth in China. The sole exception was Dell, whose share grew from 4 to 5 percent. Chinese brands accounted for 22 percent of the market, Ma said, with Legend the leader among all brands, Western or local, claiming 13 percent of the pie.

Western PC makers will have to bank on services or leverage on relationships with China-based US firms to grow, especially when the margins for hardware sales are so thin, he added. But with Legend beginning to offer services as well, the US brands won抰 have an easy time of it, he said.