facebook rss twitter

Gartner slashes PC market forecast

by Scott Bicheno on 8 September 2011, 10:06

Tags: Gartner (NYSE:IT)

Quick Link: HEXUS.net/qa66b

Add to My Vault: x

Confronting reality

Like politicians, the major market research companies are often guilty of over optimism in their forecasts. This is particularly true of the PC market, which stopped being able to rely on the consumer for growth a while ago - just ask Acer.

That didn't stop Gartner recently forecasting worldwide PC unit growth of 9.3 percent for this year, and 12.8 percent for 2012, a prognostication it felt compelled to dramatically revise down today. Gartner now reckons we'll only see 3.8 percent unit growth in PCs this year, and 10.9 percent next year.

As ever, when a professional forecaster has to revise their projections by so much, some kind of explanation is called-for. "Western Europe is not only struggling through excess PC inventory, but economic upheaval as well," explained Ranjit Atwal, research director at Gartner.

"U.S. consumer PC shipments were much weaker than expected in the second quarter, and indications are that back-to-school PC sales are disappointing. An increasing pessimistic economic outlook is causing both consumer and business sentiment to deteriorate in both regions. We're expecting consumer spending to tighten in response. Business spending will also tighten, but less than the consumer space."

All good points, but the crappy economic environment is hardly a bolt from the blue. Atwal is effectively saying things are worse than they had anticipated, and that's fine, but you still have to wonder if things are two-and-a-half times worse than they were at the time of the previous forecast, because that's the extent of the downward revision. Perhaps there are additional factors.

"Media tablets have dramatically changed the dynamic of the PC market and HP's decision to rethink its PC strategy simply highlights the pressure that PC vendors are under to adapt to the new dynamic or abandon the market," said George Shiffler, research director at Gartner.

"Vendors' tried and true business models are failing as traditional PC functionality is extended to other devices, and users continue to lengthen PC lifetimes. Vendors only seem to be flailing as they look for quick fixes to their problems. Unfortunately, the resulting chaos is just creating more confusion across the entire PC supply chain, impacting sell-in."

It's likely that tablets - which are essentially enlarged smartphones - have also had an indirect effect on PC sales by alerting people to the true potential of their smartphones. It's now easy for people to surf the web, check emails, buy products and play games on their phones, so for many the PC has become a far less compelling proposition. Tablets are getting all the attention right now, but the cannibalistic effect of smartphones shouldn't be underestimated.

"More worrisome for the long term is that Generation Y has an altogether different view of client devices than older generations and are not buying PCs as their first, or necessarily main, device," concluded Atwal. "For older buyers, today's PCs are not a particularly compelling product, so they continue to extend lifetimes, as PC shops and IT departments repair rather than replace these systems."

Gartner now seems to be predicting a long-term decline in PC volumes, and it's hard to argue with that. They will remain in place for years to come as productivity devices, but consumers will increasingly feel their computing needs are adequately covered by their mobile devices. We wouldn't be surprised to see a downward revision of that 10.9 percent forecast for 2012 before the end of this year.

 



HEXUS Forums :: 6 Comments

Login with Forum Account

Don't have an account? Register today!
People also know Windows 8 is arriving next year so unless you really need a replacement PC now or find a bargain it wouldn't surprise me people are sticking with what they have. Also,TBH any PC which can run Windows 7 fine will probably be enough for a lot of people for the next few years.
CAT-THE-FIFTH
People also know Windows 8 is arriving next year so unless you really need a replacement PC now or find a bargain it wouldn't surprise me people are sticking with what they have. Also,TBH any PC which can run Windows 7 fine will probably be enough for a lot of people for the next few years.

… and after it's had it's useful life as a Windows box, it can get a second wind as a Linux desktop! (ducks hurriedly and runs away) ;)

I wonder - as it says in the article - how many PC sales have been lost to a tablet(+keyboard?) combination. I would have thought that the folks who would have bought a top-end netbook to “flash around” would probably have shifted. I don't consider myself fashion-led (too little disposable income for that) but I replaced my netbook with a tablet quite satisfactorily.

Is it just me, or does the PC focus seem to have shifted to laptops? Last time I was in Staples/PC World/Currys there were few desktop PC's and if you strike off the all-in-one/touchscreen devices then my local PC World had a grand total of two desktop's available - compared with three entire rows of laptops. However I realise that, like quite a few fellow Hexus denizens, I'm not a likely purchaser of a desktop PC - preferring to self-build, of course following the excellent advice available on Hexus! :hexlub:

That said, if Acer etc wanted to do a hyperpowerful home server then I'd be very interested - looking for something no bigger than 12" in each dimension; at least quad core; at least 8GB RAM possible and as much (RAID?) disk as possible. (This is my project for next year - to replace my current much-abused Dell D620 VM host).
crossy
… and after it's had it's useful life as a Windows box, it can get a second wind as a Linux desktop! (ducks hurriedly and runs away) ;)

I wonder - as it says in the article - how many PC sales have been lost to a tablet(+keyboard?) combination. I would have thought that the folks who would have bought a top-end netbook to “flash around” would probably have shifted. I don't consider myself fashion-led (too little disposable income for that) but I replaced my netbook with a tablet quite satisfactorily.

Is it just me, or does the PC focus seem to have shifted to laptops? Last time I was in Staples/PC World/Currys there were few desktop PC's and if you strike off the all-in-one/touchscreen devices then my local PC World had a grand total of two desktop's available - compared with three entire rows of laptops. However I realise that, like quite a few fellow Hexus denizens, I'm not a likely purchaser of a desktop PC - preferring to self-build, of course following the excellent advice available on Hexus! :hexlub:

That said, if Acer etc wanted to do a hyperpowerful home server then I'd be very interested - looking for something no bigger than 12" in each dimension; at least quad core; at least 8GB RAM possible and as much (RAID?) disk as possible. (This is my project for next year - to replace my current much-abused Dell D620 VM host).

From a tech business hack's perspective the PC focus shifted to laptops long ago.
Scott B;2120950
From a tech business hack's perspective the PC focus shifted to laptops long ago.
Quite true - I can't remember the last time that I heard of someone with a company issued desktop - all the ‘works issue’ kit is laptops. :thumbsup:

No, what I was getting at is that the shift to laptops seems to have happened quietly in the home front too. Asking around and it would appear that the only folks that have “desktop” machines (including floor standing towers) are the one's that are heavily into either games or multimedia (video/music production), everyone else seems quite content with a laptop - and some of those are now contemplating a move “downwards” to a tablet.
We still give out quite a few desktops at work. Lots of users want dual screen setups and more speed than a non-specialist laptop can give. And as we use Citrix, people logging in from home can do it on their own PC.

We consciously support this as laptops are simply a support pain in the ass. Users treat them like a free home computer, not a work tool.