PC Sales Decline. Don’t Blame the iPad.

Discussion
May 13, 2011
George Anderson

Conventional
wisdom
that
the decline
in personal
computer sales is the
result of the popularity
of the Apple iPad and
other tablet devices
is not really correct.

Only 14 percent of early iPad adopters (those owning
a device for six months or more) stopped using a personal computer, while only
12 percent of those who bought an iPad during the Christmas holiday season
did the same, according to research from The NPD Group. The same study found
cannibalization of netbooks was down 50 percent among the holiday shoppers.

So
why has PC sales growth slowed?

“The explosion of computer sales when Windows 7 launched, as well as
the huge increase in netbook sales at that time, are much more to blame for
weak consumer PC sales growth than the iPad,” said Stephen Baker, vice
president of industry analysis at NPD, in a press release. “Overall it
appears that the vast majority of iPad purchases to-date have been incremental
to the consumer technology industry.”

How big an incremental lift have
iPads delivered?

According to NPD, the answers are in the billions of dollars.
Nearly 75 percent of consumers who bought an iPad for themselves did not plan
to buy another device, which according to the research analysis, made all of
those purchases incremental.

The iPad market has also brought added sales in
accessories. The one disappointing area has been in 3G sales. Most consumers
are not looking to purchase a wireless plan to go with their iPad.

“Consumers just do not see the utility in 3G connectivity,” said
Mr. Baker. “There’s an added expense for the device and for the service,
something a majority of iPad owners aren’t willing to pay. Since most iPads
rarely venture away from home, the value of a 3G connection is likely to diminish,
especially as other tablets enter the market and pricing starts to fall. When
every penny counts, features that aren’t core to the user becoming increasingly
marginalized as manufacturers fight for every sale.”

Discussion Questions: Will tablet devices eat into personal computer sales in the future even if they have not done so to a great degree so far? What do you see as the future of individual computing devices and what will this mean for retail?

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10 Comments on "PC Sales Decline. Don’t Blame the iPad."


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Warren Thayer
Guest
10 years 3 days ago

A dozen years ago, everyone told me to ditch my PC for a Mac. I borrowed a Mac, and the transition drove me nuts, so I just went back to my PC. A month ago, my wife’s PC crashed fatally (virus) and she was told to get a Mac. She did, and the transition is now simple. From her rave reviews, when my PC finally dies, I’ll get a Mac. Little doubt in my mind that this same scenario is being played out, one at a time, in high numbers. To my technology-ignorant mind, this could have some bearing on sales of PCs.

Ed Rosenbaum
Guest
10 years 3 days ago

Certainly, tablet devices will modestly eat into the shares of the PC over the next few years. One of the main reasons I foresee is the ease of the business traveler taking the tablet device through airport security. Not only is the tablet device smaller and lighter; I am also told you do not have to remove it from your case to pass it through the TSA scanner. Making the business traveler’s load lighter is going to be a marketing point used to promote sales. I can see us reaching the point where we only take a flash drive with us to make presentations. We could rent a laptop or tablet device at a location near our destination. Similar to renting a car for our use when we arrive.

Gene Detroyer
Guest
10 years 3 days ago
Three years ago when I started teaching, most of the students had laptops. A few had netbooks. I was impressed with the netbooks in terms of size, power, portability and price. I immediately went out and got one. Today, none of the students have laptops. Most have netbooks. Some have tablets. When I asked about the tablets, the answer is always to same. It does everything I need to do and more. I have never touched a tablet, so I don’t know what “everything” is. In class, they take notes and look up information. It seems to work every bit as good as the alternative. Will tablet devices eat into personal computer sales in the future, even if they have not done so to a great degree so far? History may have already answered these questions. Will desktop computers eat into mainframes? Will laptops eat into desktops? Will netbooks eat into laptops? There is the answer. What will this do for the future of retail? Nothing different than it is doing now. It will continue… Read more »
Gene Detroyer
Guest
10 years 3 days ago

TANGENT TO TODAY’S QUESTION: Watch out Microsoft. MS has 88% of the share of operating systems for personal computers. Their tablet operating system is a bust. Android and Apple lead the way by far. If the ultimate transition is to tablets and beyond, what happens to MS?

Dick Seesel
Guest
10 years 3 days ago

Whether you use a PC or a Mac, one real issue is the long-term viability of desktop computing. Any laptop worth its salt can do whatever a well-equipped desktop can do, wirelessly. Laptops were the first wave of portability that has led to netbooks, tablets and smartphones. The next issue will be the evolution of tablets: Can they duplicate the functionality of a fully-loaded notebook computer while getting smaller and smaller? And can the typical computer user live with just one device? Probably not.

Jonathan Marek
Guest
10 years 3 days ago

Unless I’m missing something, this analysis doesn’t prove what it claims to prove at all. The question of whether iPad sales are incremental to the industry is completely different from whether either (1) I stop using my laptop/netbook when a get an iPad or (2) I plan to get another device.

I don’t know, but I imagine many consumers decided to keep using their old laptop and add a tablet, whereas they would have bought a new laptop or netbook if the iPad didn’t exist. Only by understanding that phenomenon can one figure out how much of the iPad’s sales are incremental to the industry.

alexander keenan
Guest
alexander keenan
10 years 3 days ago

The PC today is primarily a tool of communication and entertainment. The question is what is the preferred method for communication and entertainment?

Kai Clarke
Guest
10 years 3 days ago

The decline in PC sales, is really a factor of other devices which can now do what the PC used to do. Foremost is the cellphone which clearly is replacing many of the PC functions on a daily basis. Secondly is the multitude of game players which do everything that a PC does. Finally, the obvious onset of tablets are only adding to the decrease. Add all of these together and you get a substantial decline in demand, year over year for new PCs. Instead, you will have users holding their current PCs longer before they purchase a newer one, and instead substituting their needs with better phones, tablets, etc.

Camille P. Schuster, PhD.
Guest
10 years 3 days ago

I am an avid iPad and Mac user. I also use a PC at times. Each device has different strengths. These is a lot of choice available for consumers who have different needs. For a long time it was a “PC” world out there. Now there are a few software programs that only work or work better on a PC. As that number dwindles the computer market is a market of consumer choice–like most other markets. In this new world consumers will choose the product that best suits their needs. My prediction is that anyone who can afford to do so will have a few different products to fit their various needs in different situations, i.e., classroom, traveling, game playing streaming or DVD viewing, etc.

Larry Negrich
Guest
10 years 3 days ago

I see the tablet as a complimentary device on a personal level. I don’t see giving up my PC for a tablet any more than I would give up my PC for a smartphone. Each has a place and I think each will evolve into a device used for select set of purposes. In some business settings the tablet will gain share where its mobile, os, and functionality deliver a definitive advantage.

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