The PC's Darkening Future in a Mobile World
Last week, I pointed out some of the remote access solutions shown at the Consumer Electronics Show that allow you to tap into the power of a full desktop computer from a mobile device. I said it was another nail in the coffin for traditional personal computers, which some took as my saying the PC is dead. That’s not the case, unless you look at the world solely in black and white. I don’t. For some time to come, especially in certain industries or specific use cases, the PC will be important. For most folks, however, the PC is losing relevance as we morph from a local/desktop user base to one of mobile/cloud.
A rather timely graph illustrates this. Horace Dediu, who tracks market data on his Asymco blog, tweeted an image showing a “brief history of personal computing platforms” on Saturday, going back from present day to 1975. Notice anything interesting?
Starting around 2007, when Apple (AAPL) introduced the iPhone, sales of devices running mobile platforms have eaten into a large portion of traditional desktop and laptop sales. Sales of Apple products are lumped together in this graph, so not all the green area is composed of iOS devices such as the iPhone, iPod touch, and iPad. We know that Apple sells far more iOS devices than those that run Mac OS X: In the last quarter of 2011, Apple sold at least 28 million iOS devices, vs. 4.9 million Macs. With a few niche exceptions (Google TV (GOOG) and some low-end laptops) that don’t amount to a meaningful number of sales, Android devices are all mobile devices, not traditional computers.
Here’s another telling data point showing the big picture: According to a recent Gartner news release, 352.8 million PCs were sold worldwide in 2011. To put that number in perspective, Samsung (005930:KS) alone estimates it sold 300 million handsets in 2011 and that it will sell 372 million in 2012—150 million of them smartphones. While not all of Samsung’s mobile devices are or will be smartphones, they’re all mobile devices; most can tap into the Web and run apps. Those are two key activities that are shifting away from the traditional computing paradigm.
How Many Still Need PCs?
As I said last week, I’m planning to get an Asus (2357:TT) Transformer Prime review unit (or buy one, if I have to) to test if an ARM-powered mobile device can truly fill my computing needs. Note that I don’t draw CAD files, create stunning 3D movie files, build programs, or calculate equations that require heavy processing power. The fact is: Most people don’t do these tasks, either. For many, a traditional computer can be overkill in terms of price, power, and performance. If you need 3D graphics for gaming or some other processor-intensive tasks, there’s always the option of remotely accessing a PC at home or in the cloud: Amazon (AMZN) now offers 750 hours a month of free Windows Server instances through its EC2 product line, for example.
One can argue that the lagging economy is hurting PC sales. I’d agree with that. That’s not the key driver for the trend I’m illustrating. If it is, then Ultrabooks from Intel (INTC), which are expected to cost $1,000 or more at first, won’t be too popular. In fact, sales of $200 to $400 netbooks wouldn’t have been declining over the past year or two. Sure, some folks that want to buy a PC aren’t able to spend money right now. This makes a smartphone or tablet even more appealing, as high-end handsets or capable tablets sell for much less—at least up front. Sure, there’s a recurring fee for monthly service, but it’s more manageable than spending $700 to $1,000 or more at one time.
The bad economy is actually helping create a perfect storm in favor of mobile devices. They’re a cheaper starting investment for consumers, they have connectivity to the growing number of cloud services, and they meet many needs that used to be fulfilled only by PCs. Is the PC “dead”? Nope, and I never said it was. But I tend to think ahead of the curve and ponder implications, rather than simply observe what’s going on today. If you live for today and must have a PC, there’s nothing wrong with that. But my future—and I think yours too—will become less reliant on the computer that’s on your desk or lap today.
Also from GigaOM:
Envisioning Future Strategies for Sony’s Success (subscription required)