The PC rebound cheerleaders just got another dose of reality, not that it will change their chirpy screed. According to recent Gartner and IDC reports, the PC market is heading south just like SemiAccurate said it would, not up like the industry predicted.
You might recall the recent panic surrounding the PC industry sales manifested in the awful, “PC does Whaaat?!” Campaign. In this genius marketing effort the CMOs of Intel, Microsoft, Dell, HP, and Lenovo all got together to say how rosy things were for PCs and promised to lie and use underhanded tactics to convince consumers that PCs were something they wanted. Tens or possibly hundreds of millions of dollars later, PC sales dropped another 10% or so. [Editor’s question: What percent would sales have dropped if they hadn’t invested in such advertising? Do the numbers balance?]
Those numbers are from an IDC report which says PCs declined 10.6% in Q4 on a YoY basis, the largest in history. They then go on to repeat the troika+2’s mantra about how attractive new PCs are on the market and if consumers only knew how great they are, sales would bounce back. As SemiAccurate pointed out, consumers DO know how ‘good’ modern PCs are, that is why they are not buying. Convertibles, 2-in-1s, and the rest are market poison, they reduce functionality, add cost, and break a lot. Not ironically the PC makers refuse to make the PCs people actually want. Any questions why sales are in the toilet?
Gartner on the other hand saw an 8.3% YoY decline in Q4 with an 8% drop over the entire year. Their forecast is quite rosy for 2016, these reports always see the future brightly for fear of upsetting those funding said reports, and are always wrong. In this case they claim that things will be better in 2016 because sales will only drop another 1% for the year, a claim that logically parses but strains credulity to call it good. See IDC’s 2014 numbers for some more of this, 2015 is going to be better, really.
The main difference between the two reports is that Gartner seems to count the tablet with floppy keyboard and plague of detachable screen form factors as PCs, IDC doesn’t. Adding them in to IDC would produce a smaller drop in sales but not enough to halve the loss. In any case PCs have fallen below the 300M yearly sales mark for the first time, something SemiAccurate told you about last year.
So what do we have? More of the same BS from the analysts, or more likely the unnamed parties pushing for certain formats in the reports. For literally years they have been claiming the turnaround is right around the corner. For years SemiAccurate has been laughing at them. The Ultrabook revolution was going to fundamentally reignite the moribund consumer PC market according to those selling them. SemiAccurate called them, “Shiny things for the stupid” and we meant it.
Intel laughed at us. Shortly after they cancelled it labelling the program a “failure”. Although the reasons for this were never made public, never coming anywhere close to sales goals were probably a factor. This impossible enthusiasm was then mandated by executive fiat to then be directed at 2-in-1s, they were knighted the new Ultrabook. Consumers reacted in a big way, a big negative way that is, and sales continued to drop. No actually the rate of decline accelerated, I guess they do understand the ‘benefits’ of this expensive new, less functional, and fragile form factor after all.
Throughout all of this SemiAccurate has been consistent in its analysis, and that analysis is one all the players involved unquestionably know, modern PCs are awful. Windows 8+, yes 10 included, are awful. They don’t work well. The cheap ones are miserable and die in months, the expensive ones have ‘features’ that make them less functional, heavier, and worse in every way but possibly looks. Intel artificially cripples CPUs at the low-end and prices them painfully on the high-end. Modern PCs are borderline unusable, unsecurable, user unfriendly, and quantifiably worse in almost every way for the user experience than a 5 year old device. Yet PC makers insist the problem is users not understanding the ‘value’ of the new features and ‘exciting’ form factors.
If you look at the sales charts, pick the ones you prefer but they all seem to agree that sales peaked around 2010/2011, about when the change to these new and ‘exciting’ form factors started up. Not coincidentally Windows 8 launched at about the same time. If you read the analyst reports, it isn’t any of this, one quarter it is macroeconomic conditions, commodity prices, hangover from inventory issues, waiting for a new XYZ, or whatever else they can point to. It will all be better in a few quarters or a year, just you wait. At least the message is consistent.
For 5+ years sales have been consistently down, we are now about 100M units/year lower than they were before these changes. The only consistent factors are the new PC form factors that consumers just ‘love’ and ‘want’, and the ‘exciting’ new OS paradigms from Microsoft. Time has shown that every single one of the past quoted reasons for declines from the PC maker and analyst houses were not the actual cause, when those pressures lifted, sales kept on falling. What are the odds they are right about the causes this time? SemiAccurate told you the problems, told you the fixes, and directly called for the firings of the CMOs who are running the entire industry into the toilet. They still have jobs and the rosiest outlook for next year is -1% sales, coincidence?S|A
Latest posts by Charlie Demerjian (see all)
- Intel said something important on their Q4/2020 analyst call - Feb 1, 2021
- AMD launches Ryzen 5000 Mobile APUs - Jan 26, 2021
- AMD’s Genoa gets a little clearer - Jan 25, 2021
- Another Intel outsourcing deal comes to light - Jan 20, 2021
- Qualcomm buys Nuvia for $1.4 Billion - Jan 13, 2021