The reasons for the flourishing grey market for personal computers are not difficult to gauge. One, the local assemblers offer similarly configured machines at a substantially lower price than their counterparts in the organised sector. Two, unlike the organised sector players, they have no qualms about loading pirated software onto the machines sold by them, therebymaking them even more affordable. Three, the quality of after sales services provided by most local assemblers is as good as that offered by established brands. Though many established players claim that the quality of the machines supplied by the unorganised sector is poor and that sooner or later, buyers would have to turn to them.

However, despite a favourable IT package, which should enable the organised sector to market their wares at a lower price, the unorganised sector is likely to continue to thrive for a long time to come. Even the expansion of Internet related services, which will invariably add to demand for computer hardware, is likely to benefit the grey market more. This is because for at least the next few years, demand growth will come mainly from first time users, who would be unwilling to pay a premium for a branded product.