“Demise of the PC” May Simply Be Semantics

Worldwide PC sales figures have taken a tumble — and everyone has an explanation why.

Two separate estimates show the same pattern in sales figures for January through March this year, compared with the same period in 2010. IDC estimates there were 80.6 million shipments worldwide, down 3.2%, while Gartner puts the total at 84.3 million, a 1.1% drop on its own figures.

Things are even more dramatic for US shipments, where IDC puts the figure at 16.1 million (down 10.7%,) while Gartner has the same number (though that’s a 6.1% drop on its 2010 figure.)

To clarify a couple of points: shipments aren’t necessarily the same as sales, though in the long run the two tend to be closely related (if models don’t sell, there’s no need to ship replacement stock); and it’s obvious there’s a fair margin of error in the calculations of both companies, though there’s clearly a definite downwards movement.

Is this really significant rather than just a blip? Well, perhaps more than it might seem. The worldwide figures at least should in normal circumstances always be increasing even if demand remains consistent: developing nations get richer, meaning more people are in a position to buy a PC; and the costs of producing technology such as PCs is usually falling, meaning either that prices drop or companies can offer buyers a better machine for the same price.

So what’s the cause? The most obvious factor appears to be the effects of the tough economy on US buyers. Indeed, Gartner noted that the drop in sales to consumers was pretty horrendous, and things would have been much worse if it wasn’t for business sales holding up.

Another factor may be that sales figures this time last year may have been slightly artificially high thanks to the release of Windows 7 a few months earlier: it’s certainly possible a lot of people planning to buy a new machine had put plans on hold rather than buy something running Vista.

But the real X factor is the iPad. Both sets of figures cover all the traditional forms of PC (desktop, notebook, netbook) but exclude tablets. And at first glance the figures add up. The original iPad has sold an estimated 15 million: take away the initial sales bump and you’re probably talking in the region of three million sales between January and March, which is right around the drop in PC sales from IDC.

My gut response is that even if the numbers tally up, it doesn’t sound right: after all, while I expect most of us know somebody who has an iPad, we don’t know many people who’ve gone as far as to ditch PCs altogether.

But a close look at the figures of both companies shows that by far the biggest loser among manufacturers is Acer: a worldwide drop of 12% or 15% depending on the source, and a US decline of either 24% or 42%.

Given Acer’s product lines, that suggests to me that there’s a strong likelihood that iPad sales are coming at the expense of netbooks and the cheaper notebook PCs. In other words, the chances are this isn’t a case of people ditching the “house computer” for a tablet, but rather that the iPad is taking some of the market for the second machine: the one that’s used more for casual web browsing on the sofa than “real computing.”

If that’s the case, then the whole affair may simply be a matter of terminology: while it may be argued that a netbook is a PC and a device such as the iPad isn’t, it’s entirely possible that for the “lost PC buyers” there isn’t any practical difference.¬†And if that’s the case, the number of people buying a processor-based machine that meets their needs hasn’t actually fallen at all.

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11 Responses to “Demise of the PC” May Simply Be Semantics

  1. Could it not also be that PC's are lasting longer? If people are holding out and repairs are cheap then why risk buying a new PC in this economy?
    Also does that tally in commercial sales to?

    • exactly what i was gunna say.
      people are learning how to make their PC's last longer, and are learning what to buy, to last longer. so yeah. they're lasting longer, so they dont need replaced as much.

  2. More people are turning to building their own computers, or having friends do it, as it's SO much cheaper for a better computer. This article seems to cover manufactured computers, proprietary machines, and the like, but doesn't seem to cover computer component sales.

  3. It's the "portable" fad: I call it a fad, but it wont ever go away entirely…. people are really fascinated by smartphones and tablets right now, which is logical, because they are portable, fairly powerful, and people have that stigma about sitting at home on their computer making them a "social failure" (because they haven't figured out that hanging out at a party or a bar playing with your "whatchamacalit" gadget is just as bad of a social fail.) The companies are loving this "fad" to death. Why? They get to sell you a disposable toy, that has limited power, even more limited potential for upgrades, and pretty much no potential to repair them- AND the real kicker, there's no way to use them unless you shell out money for service at luxury cost. Remember this every time you hear any computing company talk about the cloud and mobile computing- It is a conspiracy…they want to take your cheap and powerful PC from you and replace it with a less powerful computer that requires you to pay for service and full hardware replacement constantly.

  4. With the advent of Tablets (yes author, there does exist more than one) and more and more "You pick the parts, we'll build it for you" websites AND the quality of PCs becoming more and more robust, of course PC (Read: Dell/IBM/HP) sales will go down, prebuilt machines suck, thats not something you can keep secret for very long.

  5. As has been stated, part of the trend is people waiting longer to replace systems and most people are not getting a second computer for travel and browsing the web at this time but rather getting a tablet or just using their smart phone. They are computers themselves so why not? The iPad is not designed as a stand-alone device. It still is quite reliant on being cabled to a computer for updates and syncing so its current incarnation will not rid the market of computers completely, just fill the niche that it is.

  6. While i agree the shipment figures look bad, as someone who has never been swayed by the portable fad, this could be a blessing in disguise for all us hardcore pc'ers. If a product's sales aren't looking good, they lower the price, right? Im no marketing whizz, but maybe our cheap and powerful pc's, as you put it, could be even more powerful for even cheaper. I don't know! Nice post btw!

  7. Hmmm what exactly is being used to calculate 'PC sales', if it's simply using sales of pre-built machines than the entire results will be way off, and all that is being shown here is that people can find reason to make anything make sense, regardless to if it's accurate or not.

    People do tend to build their own machines, perhaps more than they used to.. or at the very least there are more smaller IT companies who will build one for people who don't have the know how.

  8. The biggest thing hurting PC sales? My computer from 5 years ago is STILL able to handle the latest games, I have only upgraded the video card and added more RAM. XP is still a very stable OS and the type of improvement that has come from the newer chips just isn't going to affect that many people. Eventually numbers are going to flatten out simply because people don't need to upgrade, not because they think typing on a flat 10" screen is somehow going to replace using Word, Photoshop, Excel or any number of programs on an actual computert with a real mouse and keyboard.

    Tablets are going to replace some PCs(And many Macs, now that people can get their beloved Apple product for about 1/2 the cost of a Mac laptop), but I think they are going to supplement far more than they are going to replace. More people are going to have a desktop unit AND a tablet, except for the ones who really do only use the thing for browsing, reading email and playing small games.

  9. The biggest thing hurting PC sales? My computer from 5 years ago is STILL able to handle the latest games, I have only upgraded the video card and added more RAM. XP is still a very stable OS and the type of improvement that has come from the newer chips just isn’t going to affect that many people. Eventually numbers are going to flatten out simply because people don’t need to upgrade, not because they think typing on a flat 10″ screen is somehow going to replace using Word, Photoshop, Excel or any number of programs on an actual computert with a real mouse and keyboard.

    Tablets are going to replace some PCs(And many Macs, now that people can get their beloved Apple product for about 1/2 the cost of a Mac laptop), but I think they are going to supplement far more than they are going to replace. More people are going to have a desktop unit AND a tablet, except for the ones who really do only use the thing for browsing, reading email and playing small games.

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