PC Sales collapse: Is it the end of an era?

The PC  has had its day – it is dead… Well actually not yet, before you sharpen your pitchforks and light the torches, steady your nerves. The PC is not dead, far from it – but today is one of the darker days in its history and most likely a sign of things to come. IDC, International Data Corporation, has today published its latest figures on the health of the PC market and its total sales.

In the first 3 months of 2013, total PC sales plummeted down 14% and is the biggest fall since IDC began tracking the market in 1994. Since the beginning of  2013 only 76.3 million PC units were sold in comparison to figures well exceeding 80 million last year. The firm highlighted the lacking consumer interest in Microsoft Corp’s new Windows 8 system, that the company had pinned their hopes upon so dearly. The PC began its humble life in 1973, with the first true personal computer, that could be available and affordable for business or extreme home use. The IBM SCAMP (Special Computer APL Machine Portable), led the market for PC’s to come – it was a first. The first computer that did not require its own mainframe and could operate on a single user computer. The consumer launch of SCAMP in 1975, named the INM 5100, became one of the first true personal computers – it boasted the ability to fit onto only one desk. Nevertheless the sales were mainly business users or engineers, a later computer designed by Xerox at the PARC facility, named the Xerox Alto would be the start of the general consumer PC market. It would feature a graphical user interface, and would not require programming; this served as a kick start for Apple’s later Macintosh computer and Microsofts Windows operating system. Many companies sold microcomputers that required programming – but home computers did not really appear until the 80’s.The Apple I and Apple II both talk markets by storm, but failed to deliver an experience capable by use of the general masses. In 1981 the IBM PC became a major success – used world wide and throughout business the IBM PC would become the stereotypical PC icon that we know today. Just at the same time Apple announced the Macintosh in ’84 and the war of the titans that exists to this day began. Rivalled camps set out to prove their band wagon is better than the others. IBM would adopt and work closely with Microsoft to bring about the Windows Operating system; Microsoft would make millions by licensing their software for use on any computer. Therefore in the late 90’s the idea of a 220px-Macintosh_128k_transparencyPC became less linked to IBM. Microsoft would advertise their software as the ecosystem built for professional use. While Apple who closely guarded their software became the unprofessional artistic tool for those who had too much money to spend.

The PC soared to major heights in the first years of the millennium. Microsoft’s Windows XP and Mac OS X brought the internet, networking and collaboration to the core of computing. The PC remained the top dog in the tech world. Once bought in to a ecosystem a consumer would be forced to continue to buy into the latest offerings of the likes of Apple or Microsoft through planned obsoletion. New iterations of Windows or Mac OS X, every time seen to be ‘better’ than the last. In 2007 Microsoft unveiled Vista, and opened a tin of  worms and headaches that would encourage many users to switch to a Mac. From that point on, the numerous driver errors, compatibility issues, corrupt hard drives and constant crashes – have propelled Microsoft in winning back consumers and regaining the crown.

But now this looks even less likely. In 207 Apple unveiled the iPhone and began the worldwide smartphone craze that exists today. Later they unveiled the iPad in 2010, which again opened the flood gates for the rest of the industry. At each new launch in the last couple of years, tablets and smartphones have become even more capable and cheaper. A tablet can word process, connect, create and surf. All the primary tasks of a PC can be accomplished on a tablet or mobile device. In attempts not to be left behind by the mobile revolution. Microsoft coined together Windows 8, a touch friendly and mobile based operating system that is primary for mobile PC’s. They bet their entirety on Windows 8. And it hasn’t pulled off. At a time were PC sales had already dipped due to the recession and tighter money spending as well as the consumer change to tablets and smartphones; Microsoft needed to pull something out of the bag:

“Unfortunately, it seems clear that the Windows 8 launch not only didn’t provide a positive boost to the PC market, but appears to have slowed the market.” IDC Vice President Bob O’Donnell

Windows 8 has failed to spark any fuse to reignite PC sales. Its user interface relies heavily on touch screens – and the added retail cost of these touch PC haswindows8 put many consumers off buying them. It has been a growing trend that consumers are mitigating content from the PC’s to mobile connected devices. Windows 8 was a rushed launch, its UI unfamiliar and prior knowledge was non existent, Microsoft is now in crisis over the future of Windows. In turn the manufacturers of PC’s have taken a beating, HP and Dell posted decrease in shipments of 20% and throughout the US a total decrease of sales by 18% since only the end of 2012. Apple has not been immune to the slump. Although it could be said that it was the father of the mobile revolution the sales of its highly popular iPad have cannibalised sales of their Mac range and they saw a decrease of 7.5%.

Top 5 Vendors, Worldwide PC Shipments, First Quarter 2013  (Units Shipments are in thousands) 

Vendor

1Q13 Shipments

1Q13 Market Share

1Q12 Shipments

1Q12 Market Share

1Q13/1Q12 Growth

1. HP

11,997

15.7%

15,726

17.7%

-23.7%

2. Lenovo

11,700

15.3%

11,705

13.2%

0.0%

3. Dell

9,010

11.8%

10,110

11.4%

-10.9%

4. Acer Group

6,150

8.1%

8,952

10.1%

-31.3%

5. ASUS

4,363

5.7%

5,401

6.1%

-19.2%

Others

33,075

43.4%

36,739

41.5%

-10.0%

Total

76,294

100.0%

88,635

100.0%

-13.9%

 

The PC is now at its lowest record since 1994. The future of the PC in its current state is unknown. The elimination of cheap low end netbook at the end of 2012 left a gap to be filled in the PC market. This was absorbed by growing smartphone and tablet sales. Many place the popularity, affordability and portability of tablets down to the demise of the PC. Microsoft and vendors have failed to inspire reasons to continue fuelling the humble PC. In fact Microsoft has possibly increase the sales of tablets indirectly via the launch of Windows 8. The company and partners face a tough decision to make. Already Microsoft has shown it is not yet ready to successfully operate in a mobile industry. Its Windows Pro and Windows Phone 8 have become the runt of the mobile market. It may soon be time for the Big Blue to step aside. Either way – Microsoft and the PC vendors of the world will have to notice the decline in sales.  A world without PC’s could be a world less efficient and productive. The decline signals a change in consumer interest, and possibly the end of an era. May the process of change and innovation be the down fall of such major tech giants we know today. Well if Microsoft and Co. don’t make up their minds soon it may well be.

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