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Struggling PC makers and Windows 8 push PC market into free fall

Worldwide PC shipments fell by 13.9% year-over-year during Q1, with higher PC prices and mobile devices also contributing

By Agam Shah
April 10, 2013 04:30 PM ET

IDG News Service - A "perfect storm" of struggling PC companies, aversion to Windows 8 and wider mobile-device adoption plunged the already struggling PC market into a free fall during the first quarter this year, IDC said.

Worldwide PC shipments in the first quarter totaled 76.3 million units, down 13.9% compared to the same quarter last year, IDC said in research released on Wednesday. The decline was worse than 7.7% previously forecast by the analyst firm.

PC shipments fell across all regions worldwide, and the market is headed into a further contraction than previously expected, IDC said in a statement.

 


   PC shipments
IDC reports that worldwide PC shipments had their steepest year-over-year drop ever in the first quarter of 2013.

The industry is at a crossroads where the future of PCs is being questioned as users move to alternative computing devices such as tablets and smartphones, said David Daoud, research director at IDC.

Instability among PC makers, higher prices and supply chain issues contributed to the poor PC market performance in the first quarter, Daoud said.

Dell is on the sales block, which may keep PC buyers away from the company, while the world's top PC maker, Hewlett-Packard, is still in the early stages of a long restructuring process, Daoud said. Innovation has come to a standstill, and PC makers are having trouble acquiring components like touchscreens that would otherwise help draw buyers to laptops and desktops.

Windows 8 also did little to help PC shipments grow, IDC analysts said. Fewer consumers are upgrading PCs to Windows 8, while businesses are largely sticking with Windows 7 as the new OS does not fit into their usage model.

Windows 8 has not been successful among mobile or desktop users, who have struggled adapting to its touch-based user interface, Daoud said, adding that users are also missing the Start button. Microsoft has to take quick corrective action to help the PC market, he said.

Even if users wanted to take advantage of Windows 8, touch PCs are expensive, Daoud said. A majority of PCs sold during the quarter were non-touch, and prices of touch PCs will fall when supply of components normalizes, which could boost the adoption of Windows 8.

Intel has been pushing a new category of thin and light laptops called ultrabooks, some of which have touchscreens and detachable displays. Ultrabooks have so far sold poorly because of high prices, but PC makers are increasing the number of touch models available as part of their ultrabook lineups.

As in previous quarters, poor netbook shipments were partly responsible for a slowdown in PC shipments. Many users of the traditional netbooks -- called mini-laptops by IDC -- have moved on to tablets, Daoud said.

Reprinted with permission from IDG.net. Story copyright 2014 International Data Group. All rights reserved.
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