PC market contracts: Business upgrade cycle weakens, consumers wary

PC market contracts: Business upgrade cycle weakens, consumers wary

Summary: Rising oil and commodity prices and disruptions in Japan due to earthquakes and the tsunami put the brakes on corporate upgrades.

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TOPICS: Hardware
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PC shipments fell 3.2 percent in the first quarter amid tepid business spending due to worries about increasing costs and weak consumer demand, according to IDC.

IDC had been expecting a 1.5 percent gain in shipments. That projection reflected caution, but rising oil and commodity prices and disruptions in Japan due to earthquakes and the tsunami put the brakes on corporate upgrades.

In other words, businesses focused on necessary replacements, but weren't buying more. Consumers couldn't find a reason to buy. IDC noted:

Long-term success will depend on hardware manufacturers being able to articulate a message that is beyond simple hardware specifications. 'Good-enough computing' has become a firm reality, exemplified first by Mini Notebooks and now Media Tablets. Macroeconomic forces can explain some of the ebb and flow of the PC business, but the real question PC vendors have to think hard about is how to enable a compelling user experience that can justify spending on the added horsepower.

According to IDC's scorecard, Lenovo shined. The rest of the field---aside from Toshiba---stumbled.

In the U.S., Apple and Toshiba had impressive shipment gains. Acer was pummeled.

Topic: Hardware

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9 comments
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  • RE: PC market contracts: Business upgrade cycle weakens, consumers wary

    Tablet market expands.

    Could there be a pattern here?
    alsobannedfromzdnet
    • RE: PC market contracts: Business upgrade cycle weakens, consumers wary

      @alsobannedfromzdnet

      Most certainly, and the pattern is this: iPad sales are gutting netbook sales.

      Netbook sales were where much of the unit growth of the last couple years came from.
      SlithyTove
  • So much for the fixed economy, w00t!

    But a serious answer, thin clients (not just "tablet devices") are expanding, while more and more companies are making private clouds and big server farms (running Windows Server) in an amusing belief that, over time, they will save on administrative costs.<br><br>Granted, the iPad is a fantastic device, but I don't see them as the reason. Especially as the iPad requires a PC for activation, data backup, etc.
    HypnoToad72
  • &acirc;??Good-enough computing&acirc;??

    [i]Rising oil and commodity prices and disruptions in Japan due to earthquakes and the tsunami put the brakes on corporate upgrades.[/i]

    Add to that the persistent recession we are mired in. Should this really come as any surprise?
    klumper
  • I disapproved almost half our PC requests last quarter

    I actually just finished doing our quarterly review, and the trend is definitely downward on hardware purchases. Some is for budget purposes as CFO/CIO have cut spending, but most are for a simple reason, the existing hardware is still adequate for the job. In 2009 the company stopped allowing laid-off employees to take their laptops with them, and that gave us units that could be re-imaged and given out as replacements. The only ones who get new laptops are VIPs (naturally) and engineers requiring high-end CPU or graphics capability.
    terry flores
  • It makes sense - the bigger the installed base

    the harder it is to grow. If 100 of Lenovo's customers upgrade, and 100 of Dell's customers upgrade, it will be a boigger gain for Lenovo then it would be for Dell.
    Will Farrell
  • Apple is up

    They are up 7-10%.... Gee, I wonder if people are tiring of Windows....
    itguy08
    • The numbers say no.

      @itguy08
      A lot of upgrade cycles from old Mac hardware to new hardware, plus Linux not being a viable replacement for a computer so peolple leaving that for a Mac.

      Beside, many people I know have Windows 7 installed on their Macs, so the reason would be that a lot of people are moving to Apple harware, while still prefering Windows as the OS.

      Gee, sorry to burst that bubble you had going.
      Will Farrell
    • RE: PC market contracts: Business upgrade cycle weakens, consumers wary

      @itguy08 - Yaep - Ya gotta wonder where that "Win7 will bring a huge update of all installed base" is going now! Obviously OS is NOT a valid reason alone to update - and add that to the other facets of portability, non-PC apps, and ongoing economic challenges, it presents a more clear picture of where users are migrating, if at all. (MY users are completely satisfied with their current productivity and in fact do NOT want to have to learn yet another OS look & feel!)
      Willnott