Can HP's PC spin-off squash PC sales overall?

Can HP's PC spin-off squash PC sales overall?

Summary: IDC said global PC shipments were up 2.7 percent in the second quarter and growth for the year will be about 2.8 percent.

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PC sales are expected to show only modest growth in 2011 and HP's planned spin-off of its personal systems unit may also add to the uncertainty, according to IDC.

The research firm said that global PC shipments were up 2.7 percent in the second quarter and growth for the year will be about 2.8 percent.

Those projections aren't that surprising since Gartner also cut its outlook for 2011 amid demand for tablets and a slowing economy.

However, IDC added a new wrinkle to the PC sales mix. Jay Chou, an analyst at IDC, said "the proposed spin-off of HP's PC business has also contributed to uncertainty in the market." In other words, corporate IT buyers and channel partners are re-evaluating HP's prospects. That fact means that PC sales may take a hit as buyers weigh alternatives---a period that could take weeks to months---or decide to hold off on upgrades. In addition, HP is the top PC vendor so any drop-off in sales is going to affect the industry overall.

Overall, IDC sang a familiar PC tune:

  • The PC industry lacks compelling offerings.
  • The economies of the U.S. and Europe are sluggish.
  • Enterprise spending is holding up and emerging markets look strong.
  • Media tablets are gobbling up sales.
  • Here's the overview for the next few years.

Topics: Hewlett-Packard, Enterprise Software, Hardware

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13 comments
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  • Return to your homes

    Repeat after me: there is no evidence that people are hurling their PCs into the sea and using only tablets. Therefore everything is fine. You may now resume normal activities.
    Robert Hahn
    • RE: Can HP's PC spin-off squash PC sales overall?

      @Robert Hahn

      +1. Tablets are media consumption devices. Great, but when it comes time to get to work, I see the iPads go away and the laptops come out.
      The one and only, Cylon Centurion
      • RE: Can HP's PC spin-off squash PC sales overall?

        @Cylon Centurion
        Millions of people only own a computer for consumption.
        How many home computers are really used for serious number crunching?...outside of techies.
        PC's aren't going anywhere but there will be a shift from using the beige box to do everything for everyone to having several devices available that serve people's needs.

        My household used to have 3 desktops. Now we have 1 desktop computer and 2 iPads. And it works better.
        Tigertank
      • Munchkins on parade

        This raises the issue of whether Microsoft has more than one PR firm hiring astroturfers to annoy us.

        Here we see the "tablets are toys but Real Men use PCs meme," while in another thread the Munchkins claim that once Windows 8 arrives, tablets will all start singing, "Hi ho, hi ho, it's off to work we go."

        You'd think the right hand would know what the left hand was doing. Guess not.
        Robert Hahn
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  • RE: Can HP's PC spin-off squash PC sales overall?

    Desktop or portable is still a PC. Stop that "post-PC" crap.
    Rigel.628
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      Joe_Raby
    • RE: Can HP's PC spin-off squash PC sales overall?

      @Rigel.628 I really wish they would stop saying post-PC too. Apple started the mess by calling a non-Apple computer a PC. The Apple computers are all PCs too.
      grayknight
      • RE: Can HP's PC spin-off squash PC sales overall?

        @G Computer Network

        What mess?
        Really. It's all just just media nomenclature. None of it changes anything.
        Tigertank
      • Exactly Right.

        @G Computer Network

        When Steve Jobs was talking up iCloud, he even referred to Macs as PC's (Personal Computers), and how we were post-pc world now.

        Nevermind the years of commercials and marketing engine trying to differentiate the Mac from the PC.

        Funny, when Apple has a new bill of goods to sell, they pretty much tell consumers: "Meh, forget everything we've told in the past"
        UrNotPayingAttention
  • HP's spinoff won't succeed

    I really hope Lenovo takes the top position within a couple years time. They are a good company to deal with. Spiffs and in-house/demo-use discounts are huge (up to 50% off cost), and volume purchase discounts start at a quantity of only 5 units. AND they have units that are cost-effective for both home and business use (ThinkPad Edge comes to mind).

    Also, extended warranty service is CHEAP! The new ThinkPad Edge E525/E425 Llano machines will have a 5-year Priority warranty for only $99 (same price as current 3-year warranty). Or you can take a 3-year on-site warranty from Lenovo for only $11 more. Yes, that means a guy from Lenovo will come to your home/office and fix it on the spot, on the next business day. For $110. For 3 Years!

    Now tell me how much that last big-box in-store warranty that you purchased had cost and what kind of service you get with it.... Best Buy's policy is that they can have a unit in possession for up to 8 weeks before they consider replacing it, and you have to take it there yourself. And I bet it's more than $110 for a 3-year warranty alone.
    Joe_Raby
  • Desktops aren't going anywhere.

    There will just be new from factors that offer more taylored solutions to more people. And that is a good thing.
    Tigertank
  • PC Market Not Competitive Enough

    The trouble is that x86 PCs are too tightly controlled by Intel and Microsoft. Most of the profit in a brand-name box you might buy at your retailer goes to these two, with only slim pickings left for everyone else in the chain.

    This is why there is so little innovation in PCs nowadays. The innovation has moved to the next stage, namely the ultramobile devices--smartphones and tablets, and who knows what else after that. This shift has caught both Intel and Microsoft flat-footed, and they are now struggling to try to maintain relevance in this new era.

    Anyone like to lay odds on how successful they're likely to be?
    ldo17