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PC sales in spiralling death dive

Traditional PC sales are in a spiralling death dive according to Gartner UK. Australia may be a long way away, but the trends are relevant here.

Sales of x86 - Intel and AMD based - devices including Windows PCs, notebooks, tablets, and Mac Air/Book/Pro/mini were down 21.2% in Q3, 2013.

Gartner says that desktop devices - including touch based all in ones - are now relegated to mundane typing roles where touch is not required. Traditional non-touch notebooks are in a sales stasis, touch notebooks are doing a little better, with the only growth in Windows 8.x tablets/hybrids - cannibalising sales of other form factors – negative growth.

Gartner UK research director Ranjit Atwal said, “Eleven of the previous twelve quarters showed decline in the UK x86 market. The western European PC market is declining faster than expected.”

What is selling?

Local retailers confirm that the top selling device is an iPad. A JB Hi-Fi source said, “The iPad is outselling all other tablets – four to one. Accessory sales for iPads were generally limited to a cover – few buying a keyboard at time of purchase - less profit. iPad is replacing traditional desktop Mac and PCs that were being underutilised in the first place – you don’t need a desktop for email, Internet, contacts and most daily duties.”

He was bullish on Windows tablets and the Surface Pro 2 in particular “Windows tablets have overtaken the sales of desktops by four to one. Surface Pro 2 accounts for 66% of these sales and we can up-sell accessories like a Type/Touch cover and mouse a larger external screen. That is where we make the profit,” he smiled.

Other stores had similar opinions – Windows tablets are a replacement for desktops.

What about phablets?

Research shows that mini tablets (7-8”) and stylus based phone/tablets (phablets 6-7”) are in demand, especially in Asia where handwritten glyphs are more important. It also reflects that these users tend to use the smartphone - rather than a desktop - a primary computing and content consumption device.

“There is a lot of interest in the iPad mini (Retina) but that is not translating to significant pre-orders. It is not an iPad nor is it a large phone but we expect the market for mini tablets to grow – mainly driven by price.” JB’s sales person said.

What about gaming?

Gaming has become a very specialised industry and the mass market retailers have lost traction there – if they ever had it to start with. Local parts reseller MSY said that Antec or CoolerMaster cases, BenQ monitors, Patriot memory, high-end AMD processors, and Radeon graphics cards were in strong demand. “It is not unusual for a gamer to spend $600-700 on the top end Radeon R9 290X video card – the hottest gaming item right now" he said.



What about enterprise?

Earlier this year at the Intel Haswell launch, I spoke to Scorptec and ASI Computers – two remaining high-end ‘white box’ assemblers. Both offer products in the value, business, performance, and server sectors and the response was that in value and business arena tablets and hybrid touch devices had severely affected those sales. The performance (CAD and graphics) market was buoyant and servers are always in demand – whether in a rack in the datacentre cloud or locally.

Scorptec mentioned that instead of having off the shelf stock lines it had moved to build to order allowing total customisation as the standard. It had noticed that the majority of sales were now for PCs over $2000 and up to $5000 for a liquid cooled Corsair Cube 3 Gamer.

At the recent HP business launch a similar story was told – notebooks replacing desktops but the workstation and servers were still buoyant.

What about Mac?

Mac sales are down. Of the five major PC makers in the United States, Apple was the only one whose shipments fell last quarter.

Apple believes touch is for tablets and smart phones – not desktop and notebooks - and what it believes, it believes.

Mac OS X, like Windows 7, is not a good touch interface – menus, drop down boxes, mouse like precision required to navigate large screens. Apple may well be faced with RSI claims if it went all touchy feely on Mac.

Various patents have been lodged for Mac touch devices but analysts say that is just to protect its rights in that space. Two things need to happen and I cannot see either in the near future.

First is the gradual move from the OS X interface to the iOS 7 interface – yes that is a ‘cosmetic’ given over time but in doing so consider the massive reduction in functionality inflicted on iWork in order to become a touch based product. Both touch and ARM devices have inherent issues on the desktop at this time.

Second Mac users are more wed to their device than Windows users – do not change what is not broken they say.

In this case Apple is wise not to follow Windows 8.x – an old saying is ‘Pioneers get shot by Indians’ – and it can afford to leave well enough alone for some time to come.


Not so much opinion as a statement of fact – the vast majority of users can get by on a mini tablet especially if - like the $399 Toshiba Windows 8.1 Encore - you pair it with a Bluetooth keyboard and mouse, and external HDMI screen – you have a full PC with Microsoft Office Home and Student thrown in free.

For over 30 years, I was a shareholder in a major computer retailer that closed its doors in 2010. The writing was on the wall then that computing was fast becoming commoditised and a scant three years later, that moment has arrived. Vale desktop – you have served us well.


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Ray Shaw

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Ray Shaw ray@im.com.au  has a passion for IT ever since building his first computer in 1980. He is a qualified journalist, hosted a consumer IT based radio program on ABC radio for 10 years, has developed world leading software for the events industry and is smart enough to no longer own a retail computer store!