With a volatile economy, a lot of people are keeping close tabs on computer shipments to see if maybe, just maybe, they’ve finally hit rock bottom. IDC published its latest quarterly worldwide PC shipments tracker, and while PC shipments still shrunk, it wasn’t as bad as forecast. Paul Otellini, Intel’s CEO, believes the bottom has been hit.
The figures from IDC are telling. During the first quarter of 2009, PC shipments dwindled worldwide by 7.1%, to 63.5 million units. Since IDC’s prediction for this quarter was a decline of 8.2%, there’s actually some reason to be optimistic if your life depends on selling computers. According to IDC, the quarterly results were relatively good (compared to the predictions) because of falling PC prices (think netbooks), and new PC buyers around the world.
Intel CEO Paul Otellini had to deliver some fairly bad quarterly figures for his company, but despite that, he believes that the PC market has hit the rocky bottom. “We believe PC sales bottomed out during the first quarter and that the industry is returning to normal seasonal patterns,” Otellini said in a statement, “I believe the worst is now behind us from an inventory correction and demand level adjustment perspective.” However, the company refuses to give out a financial forecast because of the uncertain economy.
IDC also stated that the worldwide marketshare figures for computer makers are still the same. “HP [holds] 20.5 percent of the market, followed by Dell (13.6 percent), Acer (11.6 percent), Lenovo (7 percent), and Toshiba (5.4 percent), according to IDC’s numbers.”
Apple isn’t mentioned at all in that group, and yet, a lot of people maintain that they’re also PC’s, which the Intel ones are definitely able to run Windows, amongst other things…
But, back to the main program: unless you’re starting up a new business, or you have a computer that’s dying a horrible death, seriously, how many people can justify buying a whole new computer if they already have one that works? I have a 10 year-old PC (admittedly, better than average hardware for the time when bought, in terms of balance) that isn’t too much slower than modern machines for the sorts of tasks the majority of people use their computers for: watching YouTube, email, and the web in general. Sure, it helps that I actually know how to keep a system running optimally, but the point is this: the practical requirements that people have for PC’s hasn’t changed all that much in a decade, unless they’re of the higher end users that also happen to have a time/value tradeoff to make which makes it worth spending money to get a new machine. There are things I do that can make it worthwhile getting a faster machine, but seriously, how fast do home computer users *NEED* to encode video or something like that, since there’s no money involved, and once they set it up and tell it what needs to be done, they don’t really need to sit there and wait. It has been my personal experience in the field is that unless there’s legal requirements changes, the same thing happens with software, too: if it still worked well enough to function as needed a year ago, why upgrade when the economy is down? It’d be very interesting to see a plot of the statistics for software sales and see how they line up with hardware sales.
You’ve raised some valid issues and I’ve been wondering whether we’re going to hit a performance plateau where computers will get to a speed where the ‘need’ to upgrade becomes less and less to the point that we see a plummet in sales. I would have been sceptical that this is the plateau but given the move by Microsoft to make Windows 7 more efficient – the usual motivation for hardware upgrades (Windows and OEM – the symbiotic relationship) is no longer going work and hardware performance has gotten to a point where the vast majority of end users are pretty much happy once they get a Core 2 (or even a Core ‘Classic’ or Atom is more than enough).
I don’t think things are going to pick up any time soon as there is a move to cheaper Atom based hardware and Windows 7 improves in efficiency – so we might see another round of consolidation in the OEM marketplace as shipments drop and margins decrease.
As for Apple, Apple is pretty much immune from the swings in the PC cycle because their hardware is different enough in regards to EFI and being able to run Mac OS X to make it subject to other factors besides hardware plateau and operating system releases.
Apple isn’t mentioned in the that group because Apple isn’t in the worldwide top 5 of PC makers. If you read the link carefully they do list Apple in the top 5 *US* PC makers.
i’d suspect that apple only got 3,5% of the worldwide unit market share, but 7% of the revenue share and 21% of the profit share.
maybe they fare even better: http://apple20.blogs.fortune.cnn.com/2009/03/05/apple-so-far-immune…
Edited 2009-04-16 07:33 UTC
Did you read the original article? This is what it says:
So Apple appears to be underperforming compared with the general US market. The article is silent about the worldwide position, though.
i was writing about apples share of revenue and profit. the linked text suggests that the average price of the computers apple sells stays high while the average price of the other pcs is falling sharply (i blame the netbooks). that could mean that apple gets a bigger share of revenues and profit while loosing market share calculated by units sold.
I’m doing my part–just bought three new machines in the last two weeks.