The picture is getting grimmer for the PC industry as IDC reports the steepest decline ever in a single quarter since the market research firm started tracking the stats in 1994. It's even worse than analysts thought.
Worldwide PC shipments totaled 76.3 million units in the first quarter of 2013. That's down 13.9 percent compared with the year-ago period and worse than the forecast decline of 7.7 percent. The decline comes despite some mild improvement in the economy -- and some new PCs carrying Windows 8.
"At this point, unfortunately, it seems clear that the Windows 8 launch not only failed to provide a positive boost to the PC market, but appears to have slowed the market," said Bob O'Donnell, IDC program vice president of Clients and Displays. "While some consumers appreciate the new form factors and touch capabilities of Windows 8, the radical changes to the UI, removal of the familiar 'Start' button, and the costs associated with touch have made PCs a less attractive alternative to dedicated tablets and other competitive devices. Microsoft will have to make some very tough decisions moving forward if it wants to help reinvigorate the PC market."
'Surprising and Worrisome'
The fact that HP and Dell are restructuring and reorganizing hasn't done the PC industry any favors. According to IDC, Lenovo remains a standout as it continues to execute on a solid "attack" strategy. Mid- and bottom-tier vendors are also struggling to identify growth markets within the U.S. IDC identified whitebox system builders as among the most vulnerable group of vendors. This sector of the industry is undergoing consolidation that is affecting shipments as well as the distribution sector.
"Although the reduction in shipments was not a surprise, the magnitude of the contraction is both surprising and worrisome," said David Daoud, IDC research director for Personal Computing. "The industry is going through a critical crossroads, and strategic choices will have to be made as to how to compete with the proliferation of alternative devices and remain relevant to the consumer. Vendors will have to revisit their organizational structures and go-to-market strategies, as well as their supply chain, distribution, and product portfolios in the face of shrinking demand and looming consolidation."
Regionally speaking, the U.S. market had another dismal quarter, contracting 12.7 percent year on year, with a drop of 18.3 percent compared with the fourth quarter of 2012. With total volume falling to 14.2 million, quarterly shipments reached their lowest level since the first quarter of 2006. With this latest figure, the U.S. is now in its 10th consecutive quarter of year-on-year contraction -- excluding a brief moment of growth -- less than 2 percent year on year -- the third quarter of 2011.
Blame it on Microsoft
Roger Kay, senior analyst at Endpoint Technologies Associates, said the decline in PC is squarely Microsoft's issue.
"Businesses will still buy PCs. The PC market is not going to go away," Kay told us. "This dramatic decline in the real market will continue for a while but it will hit a baseline because people will need new PCs. But introduction of Windows 8 not only failed to stimulate the market, it actually may have effectively killed the market."
Apple, too, is helping kill the PC market. Apple fared better than the overall U.S. market, but it still saw its own shipments decline as Apple PCs compete with its own iPad tablets.
Beyond that, tablets and smartphones continue to divert consumer spending, according to IDC. PC industry efforts to offer touch capabilities and ultraslim systems have been hampered by traditional barriers of price and component supply, as well as a weak reception for Windows 8.
Posted: 2013-04-11 @ 11:49am PT
I have windows 7 on my PC. I've played with windows 8 on and off for some time now. it is (windows 8) very had to get use to.
If I had to buy another PC I'd demand that they put windows 7 in it or I wouldn't buy it at all.
there's to much of a change. It may be good for the I pads/tablets etc. not not for a PC.
you don't change a horse in mid stream!!!
Posted: 2013-04-11 @ 11:42am PT
Computer specs have reached the point of being able to last longer because they have specs that are much higher than business and most public users require to run their applications. There for all one really needs to replace is a hard drive every once in a while. The only users who need to stay current with new pc technology are hardcore pc gamers.