The PC is dead. Long live the PC

The PC is dead. Long live the PC

Summary: PC shipments are expected to decline for the first time in over a decade. Is it the economy, or a post-PC evolution?

SHARE:
TOPICS: PCs
66
angry-woman-breaking-computer-stock-620px

For the calendar year 2012, PC shipments are expected to decline for the first time in 11 years, according to a new study.

Not since 2001 has the worldwide industry suffered such a decline, raising questions about whether we're weathering an economic slump -- or watching an evolutionary change.

The study, by research firm IHS, predicts that the total PC market for 2012 will contract by 1.2 percent, to 348.7 million units shipped. Last year, manufacturers shipped 352.8 million units.

IHS analyst Craig Stice had this to say:

There was great hope through the first half that 2012 would prove to be a rebound year for the PC market. Now three quarters through the year, the usual boost from the back-to-school season appears to be a bust, and both AMD and Intel's third-quarter outlooks appear to be flat to down. Optimism has vanished and turned to doubt, and the industry is now training its sights on 2013 to deliver the hoped-for rebound. All this is setting the PC market up for its first annual decline since the dot-com bust year of 2001.

How's that for a feel good hit of the summer?

The reversed outlook blames false hope in ultrabooks, convertible tablets and Windows 8 -- marketing bunk, niche form factor and not-yet-shipped, respectively -- but the question is whether we're seeing tight-fisted spending in an unstable economic environment or the beginning of the post-PC era, where mobile is king.

To answer the economic question, we can look to 2001 for guidance. 

We wrote then, in 2000:

IDC predicts that 38.8 million PCs will be sold in Europe, the Middle East and Asia in 2000 -- a growth of 16.4 percent, down from 16.7 percent in 1999. However, it does not believe the small drop is the start of a slide in PC sales: Internet access is still driving consumer sales, and the free calls model being adopted by AltaVista, ntl and Freeserve will help keep PC demand high in 2000, according to IDC analyst Andy Brown. "This is not the beginning of a slide, sales will continue to be strong in 2000," he said.

But although Brown predicts another healthy 12 months, by 2001 PC technology will start to loose its appeal. He predicts PC sales will drop "in 2001 to around 15 percent".

Brown foresees that alternative technologies such as WAP phones, Bluetooth and interactive TV are already beginning to effect PC sales. "There certainly is a greater focus on wireless technology. Consumer devices and interactive TV are starting to impact the low end of the market," he said. 

Once you pick up your slackened jaw from the time warp, you'll note a few things:

  1. There were drivers that helped keep PCs relevant, namely the Internet.
  2. There were fears that other technologies would render PCs irrelevant.
  3. Many of those fears pertain to technologies still sitting on the sidelines today.
  4. With the benefit of hindsight, we know that the 2001 slowdown preceded a decade of unfettered growth -- both for PCs and the "alternative technologies" then-thought to compete with them.

In other words, a similar situation to what we have today. Except now, most of our discretionary computing -- uploading family photos, sending e-mail for personal reasons, getting driving directions, looking up information -- has moved to mobile devices.

We may not be seeing the end of the PC -- after all, we all have a lot of work to do at the office -- but we may be seeing the beginning of the end of the consumer PC, or at least the prevalence for homes to have second, third and fourth PCs scattered about the house.

In today's report, IHS generally concerns itself with the outlook for 4Q12 -- the crucial, technology-friendly, profit-generating holiday season we're now in -- but I'm much more interested in what comes after that. Because it appears that while there are more individuals with more access to connected computing devices than ever before, few of those fall under the old category of "PC."

IHS believes that a "strong rebound" could occur for the PC market in 2013, but unless there's some lucrative market somewhere on Earth that still hasn't been tapped by multinational PC makers, I think that's unlikely. The boom days for the PC are over, and my hunch is that PC shipments will continue to rise in a linear fashion -- after all, more people working need more computers which need to be replaced more frequently because we're making technological leaps more rapidly -- but that growth rate will pale in comparison to the rise of other connected computing devices, which I believe will replace their disconnected counterparts quickly and easily. 

The traditional PC and mobile device never addressed the same needs, but the mobile device addresses some needs better. And that's where we'll see some shifting.

In the post-PC era, the PC remains viable and more vital than ever, but as a workstation -- at least until someone invents an input method that is superior in accuracy, speed and privacy to the lowly keyboard. But for the discretionary computing in which we engage every day, a mobile device will more than suffice.

"Whether a newly configured PC space could ... stand up to the powerful smartphone and tablet markets, however, remains to be seen," IHS says. I think they're looking at it all wrong: without question, personal computing devices are proliferating at a rate never before seen in history. But "PCs"? Well, it all depends on how you categorize things.

The PC is dead. Long live the PC.

Related on ZDNet:

Topic: PCs

Andrew Nusca

About Andrew Nusca

Andrew Nusca is a former writer-editor for ZDNet and contributor to CNET. During his tenure, he was the editor of SmartPlanet, ZDNet's sister site about innovation.

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

66 comments
Log in or register to join the discussion
  • exactly

    I'm at the point where we have one workstation (to handle heavy stuff), 2 PCs and an assortment of smartphones/laptops/netbooks/tablets in our 4-person heavily-networked household. One PC is not used, and the other barely so. If I replaced either PC it would be with laptops. One thing I need to add is a home media server.

    If I had a Microsoft Surface, I might reduce the time spent on my workstation and Lenovo laptop considerably... heck, I'd go all-tablet if I could. Maybe someday.
    Texrat
    • pc converted to server for your home media

      i'm guessing those pcs are at least dual core. why not turn your unused pc's into networked servers (at least 4 cores with plenty of ram and memory if done right but just guessing), split the functions, save some money, get that dream home media server, discover the glories of linux especially ubuntu, and save the earth while preserving our mineral resources. rare earth minerals don't grow on trees.
      atseert
      • To the Post-PC folks: It's the economy, stupid.

        Tell me how much that data plan costs suppose you don't go outside of the monthly limit. One year of such plan could buy you two affordable PCs with a much enjoyable UX (b/c of the bigger screen). High expense under this struggling economy is headache waiting to happen.

        Mobile business is clearly heading toward a bubble like that of Nasdaq and housing. Mobile folks assume it'd just grow 20-30% every year so everyone jumps in for a piece. NOT GONNA HAPPEN. The same irrational expectation was there in the Nasdaq and housing sectors, and we saw the outcome. Mobile will go the same route. You've heard the warning, now.
        LBiege
  • My iPad does 50% of what my home computer does

    but that is probably closer to 80% of myhome PC time. I still use my imac when I need to use Autocad or Photoshop or any intensive creative work that needs to be done quickly and precisely. But most of the time at home, my iPad does all the rest.
    Tigertank
    • Sometimes 50% isn't enough

      It's great if that 50% is 100% of what you need to get done, but being able to _only_ half of a job is a failure in my view.
      cwallen19803@...
  • It will be a fast death

    The death to the PC will come at the hands of the iPad/tablet and the cloud. Laptop could be next if this happens. Cloud servers become very cheap. I do 75% on work on my iPad. We used a cloud service like Citrix and I could run excel files and even edit them through my iPad. I could even Run my accounting programs also with out a single crash. My travel bag is considerably lite now.
    ser182
    • Err, have you ever heard of these things called Windows 8/RT PCs?

      I don't know how this author and other analysts can do analyses of the PC industry, and disregard one of the most profound changes due in a couple of days. All these analysts do is stare at trends and extrapolate these trends. That is the extent of their analyses. Personally, I believe the PC should be congratulated for surviving so long in the consumer market with scarcely any Windows application support. The Windows PC has been staring into the headlights of change in the consumer market like a deer all these years, without showing significant adaptation - besides the inclusion of a browser. Windows 8 is MS' first wholehearted adaption of Windows to the consumer market. This means the PC will provide the most compelling user experiences of larger computing devices (from tablets upwards) in the consumer market, and will provide a slew of apps, making engaging with Internet based services more compelling than ever.

      I believe Windows 8 will be very disruptive, and will upset the tablet market - making the above referenced oversimplified analyses of the PC market worthless. I also believe that large touch screen devices will rise in popularity, leading to a resurgence of PC gaming, while opening huge, new opportunities for entertainment throughout the home. This could be even more disruptive than the introduction of cable TV.

      Windows 8 is not just an attempt to counter the iPad and address the tablet market, it is a radical reinvention of the PC that seeks to further expand its influence in a modern way.
      P. Douglas
    • I do not think so

      Diaper also seems like a more advanced solution. It is portable. It does not require running water. There is almost zero maintenance. Yet diaper is staying in its niche.
      paul2011
    • You got to be kidding

      you do not run excel files
      Let me see you do a complex spreadsheet with a pivot table and macro programing using a pad. Just typing on I pad is a feat into itself
      Richardbz
    • Why always either a PC or some

      Other device, why not both? It is highly likely that there are none to very few people right here on this forum that don't have some kind of regular computer as well as a smart phone and a tablet. Most of the time people can use a normal car, but there are times when a pickup truck or something even bigger is needed. Most of the time a smartphone or tablet will be used, but there are times when the small screen of these devices is very inefficient of anybody's time use.
      arminw
    • You guys must all spend all your time in big cities...

      The cloud.. the cloud... I keep hearing about the cloud being the death of PCs. I have no wireless access that I didn't put into place over most of the area I work in, and even then the access is spotty. If I don't have it on a local drive, I don't have it for most of my work day. Tablets generally don't have enough storage to carry the files I need access to, nor do they run the applications I need to do business.

      I like tablets. Give me one that has 500MB of storage and runs excel/word/ppt (and that I can actually enter data with at faster than hunt and peck speeds) and we can start talking. Until then, tablets for me are just toys. And the cloud is a great idea that is 10 years away from being real.
      man_on_the_hill
      • That should be 500GB of storage, obviously...

        problem between brain and fingers...
        man_on_the_hill
  • if you think desktop computers are going extict you're crazy

    The mobile market isn't saturated and that is why it is exploding and putting a lull on desktop computers. Sitting at a desktop with a nice computer has probably 30 or more years ahead of it. As long as people sit on chairs and have an ass to sit on, there will be computers or some kind of computer devices to access the Internet and be productive. I have a Galaxy tablet, Galaxy phone, and Linux desktop computer and they each have their use case. If by PC you mean windows computers...maybe you're right...

    That's just my opinion of course and I may be wrong...I don't think I'm some super smart guy who knows it all but it seems like to me nothing else fits the ergonomic situation as well as a desktop sitting and computing device for consuming media and such.
    robotaholic
    • You are correct.

      If ANYONE thinks for a nano-second that the office PC is going to be replaced by a Tablet device...KEEP DREAMING KIDS. Isn't EVER going to happen.

      For mobile use, yes, the Tablet may replace laptops, but in an office environment in business, academia or government...not a chance in heck that any Tablet will replace the desktop PC.
      IT_Fella
      • The only way an office computer can be replaced by a tablet

        is by the tablet having enough capabilities for the office user. For some, a tablet could already replace most of what they do (performance wise), they just need a keyboard and monitor. For others, multiple monitors, more ram/processor/graphics/etc. are needed. So some sort of tablet dock that can add processors/ram/graphics/sound/etc. to the tablet, then we can replace the "desktop" with a tablet. But we need a full blown OS on the tablet and better hardware capabilities. It is coming.
        grayknight
        • You're not really serious, are you?

          Your scenario makes NO sense whatsoever. Why buy all those peripherials for a tablet to make it a desktop?

          The vast majority of OFFICE users have no need for a tablet.
          IT_Fella
    • One big reason why

      PC sales are down, is that any computer bought 4 or 5 years ago is more than sufficient for most people's needs. A top-of-the-line, powerful desktop computer, such as for example a MacPro, is still as powerful, if not more so, than the current crops of desktops. It will still run the latest software. Even a 4-year-old laptop is no slouch compared to what is available in stores today. An older computer upgraded with an SSD drive and as much memory as it will hold, is faster or at least feels that way, than the newest system with an old-fashioned mechanical drive.
      arminw
      • This is a fantastic point ...

        ... and one that doesn't get taken into consideration very often. 10 years ago, software was considerably ahead of the state of hardware, and in order to run the latest programs, one had to regularly upgrade or replace his/her computer.

        Today's PC landscape is different. For the vast majority of users (home & business), hardware far outpaces their software needs. We have parents and grandparents with high-powered dual or quad core systems which, even if purchased 5 years ago, are still more than capable at running pretty much everything thrown at them.

        Obviously, the glaring exception is in workstation and server applications, but I'd like to just put a pin in those for the sake of this conversation.

        For example, I purchased a laptop in 2007 with a dual-core system and 2GB RAM. True, I've replaced the hard drive several times, and it's now running an SSD. But the fact remains is that my 5-year old laptop still does everything I need it to do. Why buy a new one?

        More so with desktops. From personal experience of about a decade of working as a technician, I've observed that most people have very limited computing needs. Though there certainly are gamers and higher-level users out there, most people get by just fine with web surfing, document processing and tax preparation.

        Even today's low-powered desktop processors are more than adequate for general computing. Remember the days when a Celeron or Sempron equated with a horrible computing experience? No longer.

        So it's no surprise that people are less inclined to purchase new PCs - for all intents and purposes, their "old" PCs are running just fine.

        I don't think that this is the only reason (not at all), but it's definitely a contributing factor.
        lapland_lapin
  • Consumers are spending, just not on PCs.

    "...but the question is whether we're seeing tight-fisted spending in an unstable economic environment or the beginning of the post-PC era, where mobile is king."

    Consumers have no issues opening their wallets in other markets (smart phones, tablets etc). The PC have reached its peek, its matured. Consumers no longer feel the need to run out and purchased the latest PC to surf the internet faster. Or load Office a second quicker. If their current PC is not broken, then why fix it? Rather spend their money on that other cool device everyone's talking about (iPad, Kindle).

    Some are predicting tablet sales to overtake PC sales by around 2016. The personal computer was introduced some 35 years ago, and the modern tablet (the iPad) was introduced in 2010. That means it will only take the modern tablet 6 years in order to match the annual sales of the 35 year old PC. Ignore the trend at your own peril.
    dave95.
  • The PC is dead. Long live the PC

    The 2nd PC is no longer needed so its not being replaced. Its more of an economic thing. It has very little to do with mobile gadgets. Once we see Microsoft Windows 8 released there will be a bump in sales.
    Loverock Davidson-