PC sales expected to decline

It would be their first drop in more than a decade.

By Benzinga Oct 11, 2012 11:49AM

Image Source, Getty ImagesBy Louis Bedigian


After 11 years of growth, sales of PCs -- including notebooks, netbooks and desktops -- are expected to decline.


This revelation comes from three different researchers. In a report by IHS iSuppli (IHS), the researcher showed that worldwide PC shipments will contract this year by 1.2% to 348.7 million units. In 2011, 352.8 million units were shipped.


In another report, IDC found that worldwide PC sales declined by 8.6% in the third quarter. In the United States alone, shipments declined by 12.4%. Gartner (IT) published similar results.


"There was great hope through the first half that 2012 would prove to be a rebound year for the PC market," Craig Stice, a senior principal analyst for computer systems at IHS, said in a company release. "Now three quarters through the year, the usual boost from the back-to-school season appears to be a bust, and both AMD and Intel's third-quarter outlooks appear to be flat to down. Optimism has vanished and turned to doubt, and the industry is now training its sights on 2013 to deliver the hoped-for rebound. All this is setting the PC market up for its first annual decline since the dot-com bust year of 2001."

Gartner concurred with that assessment.


"Retailers were conservative in placing orders as they responded to weak back-to-school sales," said Mikako Kitagawa, a principal analyst at Gartner. "By the end of September, retailers were focused on clearing out inventory in advance of the Windows 8 launch later this month. On the professional side, there was minimum impact from Windows 8 in the quarter because the professional market will not adopt Windows 8 PCs immediately after the release."


"PCs are going through a severe slump," added Jay Chou, a senior research analyst with IDC's Worldwide PC Tracker. "The industry had already weathered a rough second quarter, and now the third quarter was even worse. A weak global economy as well as questions about PC market saturation and delayed replacement cycles are certainly a factor, but the hard question of what is the 'it' product for PCs remains unanswered. While Ultrabook prices have come down a little, there are still some significant challenges that will greet Windows 8 in the coming quarter."


Dell (DELL) and Hewlett-Packard (HPQ) are among the biggest companies enduring declines. In the third quarter, Gartner said, HP declined by 16.4% worldwide, while Dell dropped 13.7%. In the United States, the declines were even greater.


Domestically, Apple (AAPL) suffered as well. While the company released a brand-new version of the MacBook Pro and knocked $100 off the 13-inch MacBook Air, Apple still experienced a decline of 6.1%.


IDC's numbers are nearly on par with Gartner's, but there is one exception: IDC's research shows that Apple declined by 7%.


IHS did not provide any details regarding how individual corporations are performing.


Follow me @LouisBedigianBZ


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81Comments
Oct 11, 2012 3:47PM
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I imagine that people are just using their old ones longer.  A pad or phone does not work when you are on the computer all day for work.  I use 3 different computers  - a desktop at work (5 years old), a desktop (6 years old) and a laptap (7 years old) at home.  There is just no reason to keep buying new ones when the old ones work just fine. 
Oct 11, 2012 3:05PM
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reports of PC's imminent death are greatly exaggerated
Oct 11, 2012 3:06PM
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I'm sure there are a host of reasons for the soft sales numbers besides waning interest in the traditional desktop. The pads are big on cool and low on useful. Have you ever tried to write or edit a serious document on one? Ever try some serious photo editing on one? Ever try to repair or upgrade one? I think I'll keep my easily repaired and upgraded desktop, printer and 24" screen thank you very much!

Oct 11, 2012 3:44PM
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I've been gaming on the PC for over 10 years, there is just no reason to use anything else because nothing else is more powerful.  I've had two gaming laptops in the past, they worked well at the time because I was always on the move and had limited space.  These days I'm no longer on the move and I have plenty of space.  I run a powerful PC that plays the latest games on high settings and have dual monitors.

 

None of this is possible on a laptop, ipad or smart phone.  I can understant why people would think the PC is dying but for someone like me who doesn't have any use for an ipad or a smart phone, the PC is the only choice.

Oct 11, 2012 2:48PM
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A P.C won't be going away anytime soon because you can't be productive on a tablet/smart phone.  Yeah more people are buying tablets and smartphones to compliment their P.C purchases, however there is no way someone will write a 20 page document with an "APP" or on a screen that can be held in their hand. 
Oct 11, 2012 2:57PM
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It's declining, because they are lasting longer....?
Oct 11, 2012 4:04PM
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PC's will be around for some time yet. If you need to do serious keyboard work, a pc or laptop is the way to go. I wouldn't try to write a large document or spreadsheet on a smartphone. You can watch Star Trek or play a video game on a smart phone or tablet, which is ok for young guys with eagle eyes. Us older guys need a lot larger screen. 

 

It depends on what your primary use of the electronics is. PC's will probably lose market share in the long run but it is far to early to pronounce their imminent death. Also like anything else the market is subject to fluctuations. Is anyone going to pronounce the smartphone dead if sales drop off?

Oct 11, 2012 3:10PM
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I stopped buying PC'S from companies like Dell and Hewlett-Packard and the other ones about 3 years ago. Now I build my own. So much better building your own rig. 
Oct 11, 2012 2:32PM
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This is about a technology slump, nothing more, nothing less.

 

People upgrade thier old PCs because of newer and/or better technology. We havent seen anything really new since the 64 bit OS, which allowed us to run more RAM then before. Micro-chip technology is still moving foward, but most lay people dont understand it.

 

Also, people are starting to realize that if you take care of your PC, and upgrade the software, drivers, etc, you dont need to buy a new PC every 2 years.

 

And businesses, the real "consumer" in the PC market, are cutting costs and laying people off.

Oct 11, 2012 5:36PM
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Desktops will be around for a long time because serious users will not settle for doing serious work on a "mini screen" computer wanabe with a tiny keyboard. I have a Windows 7 with two 1TB hard drives and a 40 inch thin screen high def TV for a monitor. It doubles as my netflix screen. The picture is fantastic and no eye strain. Why would I give it up just to be trendy and spend a fortune on inferior performance? Not happening!
Oct 11, 2012 3:51PM
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You have to look at the economy as well. I just moved because my job went to Mexico 2 years ago. Not going into details but people are worried about upcoming changes if there are any. I don't see the PC becoming a thing of the past, just now people are a bit tighter on their cash and working with what works than dealing with the headaches of a new OS. It's always a hassle, I dealt with it with Vista till Windows 7 came out. It was a smooth move for Microsoft to cash in on something new that wasn't ready to be sold. It's just my opinion and you can take it for what it is... just an opinion. People are tired of buying something that is not "truly" tested before its offered for public sale. All I have to say is get it right before you offer it to the masses and quit scrambling to fix things and make everyone happy. Bottom line, you're never going to make "everyone" happy.
Oct 11, 2012 2:38PM
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No way,  I'll take a big ole clunky lightning fast connection with a PC over a smart phone any day.  I like my phone, but it just is not near as easy and fast as my PC with HSI connections.
Oct 11, 2012 3:10PM
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PC sales decline YES replaced by Tablets and Smartphones - NO WAY!
Oct 11, 2012 2:27PM
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Smart phones will never take over as long as men have big, fat, fingers.
Oct 11, 2012 4:24PM
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Tablet's aren't strong enough and wont be anytime soon. How is a tablet going to run a brand new game or render HD videos? 
Oct 11, 2012 2:23PM
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Well, if those teeny tiny little "smart phones" are going to take over, then God Bless the Optometrist because he or she is going to make alot more money than they are now. 
Oct 11, 2012 3:16PM
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The PC market has simply been saturated over the past decade or so. I see many businesses and individuals who are satisfied with the performance of PC's seven or eight years old running their 32 bit mission critical Enterprise applications which still represent a substantial investment. And many of those 32 bit apps will not run on  64 bit OS. Even when there are 64 bit upgrades to these legacy apps, these businesses and individuals are hard pressed to shell out even more money for upgrades just because the industry dictates they must, not to mention the state of the economy. The 64 bit hype began just before the economy tanked and retailers, in their infinite wisdom, over inventoried on 64 bit machines/OS. And their not going to tell you that all of the apps your are running on your "old" 32 bit machine will no longer run on the new machine. They are only interested in eliminating inventory.
Oct 11, 2012 2:40PM
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The death of the PC has been predicted regularly for some time, particularly the table top version.  It hasn't happened and isn't going to happen and anyone with any sense knows it.  Maybe smart phones will steal a few sales, and maybe people will replace their old PC less often, but the PC won't go away in the near future.  The writer of this story must have been hard up for a subject, because this story is old and silly.
Oct 11, 2012 4:39PM
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For the basic user computers might be gradually replaced by tablets but not in the gaming market or other areas such as CAD or audio or video editing in the immediate future.

Oct 11, 2012 2:43PM
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Schools are supplying kids with iPads, even the teachers are using them, good for Apple, bad for Microsoft. I think that once this trend (schools with iPads) level off, then we'll see a stabilization of the PC market. I don't think the PC market will ever truly die. There isn't a laptop on the market that can compete with the raw power of a tower machine for heavy graphics and CPU loads.

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