SIC 7378 Computer Maintenance and Repair

SIC 7378

This category covers establishments primarily engaged in the maintenance and repair of computers and computer peripheral equipment.

NAICS CODE(S)

443120

Computer and Software Stores

811212

Computer and Offices Machine Repair and Maintenance

Two main types of companies operated in the computer maintenance and repair industry: third-party maintenance (TPM) companies, which performed service contracts on equipment from various manufacturers; and original equipment manufacturers (OEM), which both manufactured and serviced computers and peripheral equipment. This distinction was less pronounced in reality, however, because OEMs often subcontracted their service agreements to either affiliated or unaffiliated TPM firms.

The computer maintenance and repair industry grew dramatically in the 1980s and 1990s as computer sales skyrocketed. From total shipments of less than 2,000 units and $600 million in 1960, the computer industry topped 900,000 units and $16 billion by 1980, and reached seven million units and $44 billion by 1990. By 2003, this number doubled to more than 15 million units annually. 2006 statistics indicated a healthy computer maintenance and repair industry, with $6.2 billion in revenue among the 13,300 mostly small establishments in business that year.

The rapid growth of computer sales introduced opportunities for small independent TPM companies to compete against the large OEMs. Nonetheless, OEM companies were reported to hold as much as 80 percent of the maintenance and repair market in some categories, such as high-end system and mainframe services. Leading OEM firms included many of the nation's best-known technology companies, such as IBM Corp., Sun Microsystems, and Electronic Data Systems. On the other hand, the majority of TPM firms were smaller local and regional providers.

The U.S. Census Bureau estimated revenues specific to this industry at $15.4 billion by the late 1990s, up more than 50 percent from $7 billion in 1990. The estimate for the U.S. market for services performed by this industry in 1998 was a much higher $62 billion. Less than one-quarter of this market, however, was served by firms primarily engaged in computer maintenance and repair. Instead, the bulk of maintenance and repair revenues were generated by larger diversified companies that had a presence in many industries. Within the PC segment, the home PC repair market was considered an emerging customer base for this traditionally business-focused service...