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Is the enterprise PC dead?

Hewlett-Packard is spinning off (that is to say, "dumping") its PC business. IBM spun its PC business off to Lenovo a while ago. PC sales in general are lackluster, especially compared to those of the devices most often cited as their replacements -- smart phones and tablets. And even "content creators" are increasingly adopting tablets as those devices gain more sophisticated applications.

So has the curtain fallen on the traditional PC market? If not, why not? And how long to you expect the decline of the business PC to continue?

Topics

Information Technology

Apple

Dell

Dortch

IBM

Laptop

Mobility

Notebook

Smartphones

Tablet

Answer This Question

Michael Dortch

asked on Aug. 18, 2011

Andrew Baker

Director, Service Operations, SWN Communications Inc.

Posted on Aug. 18, 2011

Is the PC dead? Nope.

It's not like zero are being sold... It's more like they aren't growing as fast as they used to (primarily because the software needs to catch up to the hardware these days, and because there's a lot more mobility around)

I still have laptops in use that I bought 4-5 years ago, although I will be updating these soon. I expect that tablets will have a shorter lifecycle, which will make for more purchases and happier retailers/vendors.

But there are places where the PC will still be king, even if it isn't updated but every 4 years.

The mainframe isn't dead, and the PC won't die off in the near-term, either -- it will just have somewhat less significance than it did 5 years ago.

-ASB: http://XeeMe.com/AndrewBaker

Daniel Bobke

Posted on Aug. 24, 2011

I don't think so. Regardless of your statement about "content creators", smartphones and tablets are almost 100% content CONSUMPTION devices. No one is editing a news story on their tablet or smartphone and there are certainly no coders out there writing code on their Galaxy Tab or iPad. If and when the current crop of devices or those that supplant them are viable content creation devices, the PC and laptop will be around.

Paul Massie

Senior Director Operations and IT, YouSendIt

Posted on Aug. 24, 2011

Recommended by:
Nomaan Latif

All of my users have a PC (mostly laptops) and no possibility of dropping it. Of course, many of them also have tablets, almost all have smartphones, and some have all three. Nor am I seeing the refresh rate for older PCs drop off - the PC is still key and the core of the computing.

Jim Novy

Posted on Aug. 24, 2011

Excellent answers from Andrew and Daniel. I would add that HP and IBM's decision to spin off their PC businesses is less an indicator of the viability of the PC market and more about their strategy to focus on high-margin enterprise services. Move the cheap commodities like PCs and DVRs to China while major U.S. corporations deliver high-value offerings.

Randy Grein

Posted on Aug. 29, 2011

Funny - Apple has no trouble keeping reasonable (as compared to obscene) margins on their hardware. It has a lot to do with being able to differentiate and convince buyers of the difference - something PC vendors have a hard time doing.

Major US corporations have been running this equation for years, it speaks to a concentration on business rather than development in a mature industry, and we are poorer for it.

Jim Novy Replied on Aug. 29, 2011

Agree? The problem with PC vendors is their emphasis on PCs in contrast to Apple that creates new commodity markets with their innovations while manufacturing cheaply in China, charging a premium for their outstanding brand and accumulating $85 billion in cash -- more than the GDP of 135 countries. Any PC vendor will be successful as long as they keep coming up with the "next big commodity." Mac, iMac, iPod, iTunes, iPhone, iPad...a tough act to follow, especially without Jobs. Half of Apple's revenue is the iPhone; only 25% is desktops & laptops. PCs are not dead, just a dead-end from an innovation/value perspective.

Randy Grein Replied on Aug. 29, 2011

It has been many years since components were made or assembled in the US. (grin)

Rather less than half Apple's revenue is in iPhone sales; an important distinction when considering corporate value. iPad sales are also very important as is their 82% market share of the MP3 player market - iPods. Computer sales have increased year over year, and then there are the brick and mortar stores, iTunes and App stores. All of these support each other - persistent deemphasis and outright lockout by retailers drove Apple to build their own stores. Providing a simple way to deliver music (and acquire an important revenue stream) led to the iTunes store with Apps following soon after. And remember that Apple is the biggest laptop vendor in the US and in the world with an important 11-14% (depending on figures) of the total US PC market.

Finally, their consistent healthy margin denies that computers are commodity items. Apple provides unique value in every market they enter allowing them to maintain reasonable profits through healthy (not obscene) margins. Want a quality music player? iPod. A tablet computer that works? iPad is currently the only option, as judged by the market. How about a reliable computer with ease of use and a low operating cost? Apple again. (I just semi retired my G5 after 8 1/2 years of continuous service. My wife will use it for another year or two.)

PCs aren't dead if you have brains, imagination and the drive to be the best.

Al Shultz

BtoB Marketing Specialist in Differentiation and Gaining Market Share, Al Shultz Advertising

Posted on Aug. 30, 2011

Absolutely not. The PC is going to be around for serious and basic business use for quite some time to come. True, the PC is in a "mature" phase, and we don't HAVE to buy a new one every year; so perhaps prices will slowly come down. That just means that the vendors who expect to pull ongoing obscene profits are going to exit the PC business — but that is VERY different than saying PCs are going to disappear.

Al Shultz
http://www.alshultz.com/

E. James (Jim) Brennan

Senior Associate, ERI Economic Research Institute

Posted on Aug. 30, 2011

The current Internet can't match the speed, power, security and constant access advantages of the PC, which requires less infrastructure support and is less vulnerable to sabotage and service interruptions. It is ironic that the new-tech Web (like a deep-sea diving rig) requires more connections than the older technology PCs (which are self-contained robust units like submarines or scuba gear). Of course, all this can change.

Kelly Craft

Senior Consultant - Business Analyst, Exact Software (Contractor)

Posted on Aug. 30, 2011

As long as there are ERP systems, there will be PCs.

Somewhat simplistic and tongue-in-cheek, but accurate.

Thomas Wieberneit Replied on Aug. 31, 2011

Why do you link PC's to ERP systems, Kelly? There is a long ongoing trend towards smaller devices. At many work places PC's (I mean those stationary ones, towers or desktops that the younger ones probably do not remember anymore ;-) ) have been replaced by laptops, notebooks, ... ERP makers increasingly support browser based user interfaces and apps.

To me the main reason for devices with keyboards still being dominant in this space is that the interaction method "keyboard" is still a very efficient one, more efficient than having a virtual keyboard on a screen.

Now combining the desire/need for smaller devices (well, down to a limit as screen real estate matters) with improving technologies that replace the physical keyboard-mouse combination with something that is at least as efficient while keeping the device fully mobile then we have a case for the demise of PCs and laptops.

This is independent from business systems.

Just my $.02 :-)