The vanishing PC: Race to the bottom accelerates

The vanishing PC: Race to the bottom accelerates

Summary: The demand for more performance and features has traditionally kept the PC from falling too far, too fast. Those days may now be ending, hastened by cheap tablets. The industry is responding with new platforms for low-cost laptops and tablets running Windows 8 and Android.


Computers and electronics are always getting cheaper. That’s one result of Moore’s Law. But the demand for more performance and features has traditionally kept the PC from falling too far, too fast. Those days may now be ending.

The truth is that things began to change some time ago. The writing has been on the wall since Microsoft released Windows 7, the first version of the operating system with essentially the same system requirements as its predecessor. (Nowadays, system requirements make news only when they are loosened.) But the rapid growth of cheap tablets, fueled by $20 ARM processors and the (sort of) free Android OS, has hastened the decline of traditional PCs. The industry is responding to this with new chips designed for low-cost convertibles and tablets.

Intel’s fourth-generation Core processor, which we now know will be announced at Computex in early June, will almost certainly deliver better performance, especially with graphics. But the focus of Haswell is clearly on better battery life (Intel promises the biggest generational improvement in its history) and improved thermals so that it can squeeze into thin, fan-less Ultrabooks and convertibles. The company says that touch-enabled Haswell Ultrabooks will be available later this year starting at about $600.

That’s a good start, but the real story may be Bay Trail, an overhaul of Intel’s Atom processor due later this year. The platform, which is designed for Windows 8 and Android devices, will be manufactured on a 22nm process, will have a quad-core CPU, and will deliver more than twice the performance of the current Clover Trail tablets. Intel said the Bay Trail platform will be in “touch-enabled thin notebooks with really good performance” starting at around $300 and Android tablets around $200. Most of the least-expensive devices are likely to be convertibles, or what most people consider tablets with detachable keyboards. Last week, an Intel executive told CNET that Windows 8 versions will be a little more expensive — depending on Microsoft’s pricing — but consumers may be willing to pay a bit more to run legacy Windows apps.

Intel Bay Trail

Meanwhile, there are rumors that Microsoft is toying with lower prices. Last month, The Wall Street Journal reported that the company has been offering computer makers big breaks on Windows 8 and Office licenses for devices with smaller displays. Also in March, Microsoft lowered the screen resolution requirements for Windows 8, making it a better fit for devices with smaller displays. The upcoming Window 8 refresh, code-named Windows Blue, could reportedly include new editions targeting smaller tablets and convertibles with lower prices.

AMD is used to competing on price, and company executives keep talking about how tablets and good-enough computing play to its strengths with $300-$400 devices. Its current Z-60 processor hasn’t gotten much traction (Vizio uses it in an 11.6-inch tablet), but it has two newer processors, already shipping to computer makers, which should be more competitive. Kabini is a quad-core designed for low-cost ultrathin laptops and Temash, which comes in dual- or quad-core versions, is for Windows 8 convertibles and tablets. At Mobile World Congress, AMD showed some prototype convertibles based on these new chips. These should help to push down prices of all Windows 8 tablets.

These upcoming platforms should make Windows convertibles and tablets more competitive by this holiday season. The PC market isn’t going to disappear overnight, but it is likely to look very different a year from now.

Topics: Processors, Laptops, Tablets, PCs

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  • How will $200 Android PCs sell if $200 tablets dont sell well enough?

    The industry has spoken. $200 Android tablets except for Nexus and GalaxyTab tablets are difficult to sell. Only Amazon Kindle tablets are doing better and that is so solely due their media ecosystem. The Amazon tablet ecosystem is now worth $5 billion revenue per quarter and almost rivals the iPad ecosystem in size (about $30 billion in device sales per year + $15-$20 billion in overall AppStore sales including iPhone apps).

    Where does this leave the Google Play tablet app ecosystem? It has no uptake. Much like its Chrome OS app ecosystem.

    Much like Microsoft, Google will be wise to leave the tanking consumer PC market as is. Because if they do enter it, they will get marketshare but at a loss. Some of the already declining Asian OEMs (Sony, Toshiba, Asus, Acer, LG) will not survive the $200 Android PC market. Imagine getting a $100 Android PC or $200 Chrome OS PC with a lousy ecosystem. Wow!
    • up 159 percent

      Over a year ago they are up 159 percent to 60 million units. That is not "hard to sell."
  • "Vanishing" and "race to the bottom"

    "Vanishing" and "race to the bottom" are two opposing phenomena. Race to the bottom occurs when a technology becomes commoditized, which means that the technology is virtually EVERYWHERE. And that's the exact opposite of "vanishing".
  • The vanishing PC: Race to the bottom accelerates

    I don't see much of the vanishing PC happening. Consumers may be buying laptops to replace the PC and that's been happening for years but the tablet will not replace that. All this talk of lowered PC sales is just a temporary. It will even out over the next couple of years.
    • So you agree

      That tablets are not a complete replacement for laptops as laptops are not a complete replacement for desktops? If that is the case we may agree on something which in its self is very disturbing.

      But at the end of the day what people are missing is the main point that desktop innovation has stagnated over the years and the focus was on the mobile factor. Why should we buy a PC that offers 15% better performance with 15% less power consumption? Even reinstalling the OS+Applications would be too much of an effort.

      But with technologies like hUMA, 3D stacked memory etc we are talking about a new breed of PCs that do make the previous generations obsolete from a technology point of view. In that case there is a point in upgrading because we will notice a real difference.
      • So you agree

        You won't notice any difference if you install a 4 bit MS DOS file system w/ WindoZe paint job which has a pathetic registry that breaks all the time.

        However If you install a real OS like Linux then you will be blown away.

        Don't even try to say that Linux is not easy to use. Apparently you haven't seen the new commercial release of Linux called Robolinux. 10 minute install, includes all drivers
        and updates. With 24/7 support!

        Heck it even runs all your windows programs inside of it natively. Yes in a 1 click vm install that takes only 5 minutes and is instantly up and running in its own desktop,
        running completely seamless and it can't get a virus because it is sand boxed inside a modern 3D Linux OS, 100% Debian based.
    • In my case...

      I bought tablets to replace laptops and kept my desktop PCs for heavy usage scenarios. The thing is, I stopped buying desktop PCs many years ago. I buy hand-selected components and assemble them myself. As more people choose that path, it contributes a little to dropping sales numbers.

      One other thing which nobody has mentioned is the fact that high end PCs have historically been required to play the best computer games. This helped drive the upgrade cycle. Now, the games are developed within the limitations of a console for easy platform porting. This means they barely tax a desktop PC. So, the pressure to upgrade your hardware has been drastically reduced.

      Add in the fact that the vast majority of people only used their desktop or laptop for Facebook, Twitter, browsing, and email. For these people, the tablet became the perfect replacement device.

      The point is, there are a LOT of factors contributing to the decline in desktop sales. Unless all of those contributing factors change somehow, desktop sales will slowly continue to decline until they match the minimum number required for those of us doing high-end tasks which absolutely require desktop processing power.
    • I Agree - PCs Aren't Going Away

      This sounds like another one of 1000s of articles bemoaning the decline of the pc simply because sales are a little slow right now. There will ALWAYS be a need for the higher performance of a full blown computer and they aren't going away. Besides, if you haven't noticed, there are a lot of people out of work these days.
  • Sigh...

    ZDNet. Please quit this line of horrible logic. While you wish the demise of the PC (Intel and Microsoft), it will not happen. People are still using PC's. They are not filling up the the trash heaps in China yet.
    • That is not what anyone has been asserting

      However, the replacement rate of PCs is massively tanking. We all know it, and there is no sense in denying it.

      People used to replace computers every 3-4 years. Now they're buying gadgets, and letting that PC be run into the ground. My guess is turnover time may switch to 8-10 years.
      • I think the larger point is that PCs are changing form factors.

        Everyone seems to think that PCs can only exist in laptops or desktops.

        PCs are becoming tablets, hybrids and all-in-one devices in addition to laptop/desktop models.

        The best thing about first generation tablets was their form factor, touch interface and battery life. Their biggest limitation is the operating system they run. They were designed to run phones and media players and not really designed to be full powered computing devices.

        I really tihnk Bay Trail, if it lives up to the promises, will be a huge game changer.
        • Agreed.

          Companies are not likely to spend big $$$ on new devices unless there is a decided improvement. I think you are right on with the comment about Bay Trail. It will drive the lower cost of devices, coupled with SSD, even a power user could be happy. Intel is no dummy when it comes to marketing... they enjoyed a nice boom in sales with Netbooks hit the market. Maybe we won't call them Netbooks, but lower cost, lower power requirements and lower local storage requirements will drive sales of the sub $500 device sales. It will be a win/win for the users. The PC is not dead, but it is being redefined for sure.
          • Disagree

            Parts start failing at a higher rate in that 3-5 year area. New computers are more power efficent and faster and can be a big savings in power for an Enterprise.

            Even our older Dell 24" lcd monitors from 2007 put out more heat and use more power than than the 2013 24" monitors we just purchased and the price for 2 of the newer monitors are less than 1 24" was back in 2007.

            Here is where you go wrong, let me know what mobile device can currently run dual 24" monitors, open up a full 365 tab, 50,000 lines per tab spreadsheet with thousands of formulas and VLookups without crashing or hanging? I haven't seen a mobile device yet that can do that. Someday maybe... who also wants to view or update that spreadsheet on a mobile device? I sure don't. I used remote desktop on my phone to connect to my desktop because I can, and it well, sucks, I can't really see the screen or icons. I have done it on a tablet as well, works in a pinch but still isn't my preferred method. Give my dual 24" or my 30" monitor anyday over some small tablet for getting real work done or at least a 13" lightweight laptop for doing the real work.
      • 8-10 years?

        I'd like to know where I could get one that lasts that long!
        • Shrug

          I have two music production PCs running XP that are that old. It really isn't that remarkable!
        • I'd like too

          The hard drive is usually the first thing to fail. I've had a laptop I bought in 2002 and I replaced the HDD twice, upgraded RAM once (to have more, no failure here) and it finally died last month. I still have a 1999 custom built Pentium III running a Linux server version and acting as a file server on my home network.

          The thing with replacement rate is that new OSes don't need more power to run than before. In the days from Windows 3.1 to Windows Vista, each new version required a step up in hardware to keep running.

          But from Windows Vista to Windows 8, each new version required less horsepower than the previous one, so changing hardware is not as much a requirement as it used to be, unless you want some of the newer features like touch screen or USB 3.0, but besides that, a 5-8 years old laptop/desktop is still perfectly adequate for today's requirement (basically anything starting with the Core2 generation).
          • SSDs are a big plus

            If solid state disk drives work out as well as we all hope, an 8-10 life of an entire computer would not be unrealistic. As others have said, hard drive failures account for many PCs going south. Put in an SSD, care for a computer well, and it lasts 8-10 years.

            I have recently replaced a number of computers I sold people maybe 7 years ago, running XP. They were still in good operating condition, but it was time to move on. And that's with now-trailing-edge hard drives that spin... Ben Myers
          • Laptop hdds usually burn out quicker then desktop drives.

            I still have a 99' PC with the original hard drive that works. Granted i am using it less and less but it works. Besides, replacing the hard drive is pretty easy if you know what you are doing. PC's last a pretty long time if you take care of it. It's usually dust, heat, power surges & well.. dropping it sure doesn't help. These are generally reasons a PC fails, besides not being up to spec/performance.
        • Still using 6 machines that are 5-9 years old bios dates

          5 of these were built or rebuilt/upgraded myself, all are dual through quad cores/processors running XP, Vista, Win 7. All are 3.2ghz or higher. The other is a laptop Lenovo T60, All work great.
          • Still using 6 machines that are 5-9 years old bios dates

            Vista? Really! Must be a die hard buy any Klunk from Redmond dude.