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10/10/2013
05:41 PM
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PC Market Mess: 8 Takeaways

The PC market continues to slump but not all PC makers are suffering equally. We break down the winners and losers.

5. Mac sales send mixed messages.

For at least the first half of the PC slump, MacBooks and iMacs seemed relatively impervious to the larger market's struggle. This resiliency might be fading: Apple's U.S. market share dropped year-over-year, although IDC and Gartner disagree by how much, and the company also shipped fewer units.

Should Apple be concerned? It's hard to say. Macs are obviously a small part of the Apple's iOS-dominated bottom line. Plus, OS X has gained global market share in the last year, albeit modestly. Apple's sales also aren't being propelled by enterprise refreshes like those of Lenovo, HP and Dell, which suggests Macs are performing relatively decently among consumers.

And though Apple's market share is modest, it devours a huge chunk of the industry's profit because it's the only manufacturer that sells high-margin computers in vast numbers. Apple also appears to have deliberately constrained its inventory, which might mean the company is trying to find the right supply-demand balance to sustain its place in the market, and which would somewhat explain the shipment reduction. Apple, which just refreshed its iMac line, is expected to launch a variety of new OS X products in coming months, including a redesigned Mac Pro and Haswell-based MacBook Pros later this year, and a MacBook Air with Retina display some time in 2014.

6. Tablets continue to cannibalize PC sales.

Both IDC and Gartner reiterated that tablets are cannibalizing PC sales. Tablets are approaching a sort of equilibrium with PCs in developed markets such as the United States but continue to eat heavily into desktop and laptop sales in emerging markets. An August IDC report said tablet growth is slowing modestly as markets mature, and as phablets and wearable tech begin vying for consumer dollars.

7. Asus and Acer are crumbling.

The new shipment figures were great for Lenovo, mostly positive for Dell and HP, and mixed for Apple -- but downright terrible for Asus and Acer. Both manufacturers shipped fewer PCs than they did in the third quarter of 2012, and both lost substantial market share. Neither ranked among the top five U.S. vendors, and Apple, despite slowing sales, might break into the global top five for the first time merely because Acer and Asus, who rank fourth and fifth internationally, are fading so fast. Both companies have shifted more of their attention to tablets.

8. Things are just as bad as they look for PCs.

PCs and PC operating systems aren't going extinct any time soon, but the PC market probably still hasn't hit rock bottom, and will never return to its glory days. The third-quarter numbers failed to improve from a meager baseline, even though sales should have been better in recent months due to the release of computers with Intel's Haswell processor, which improves battery life and graphics performance and makes thinner notebooks possible. Time will tell if sales improve over the holidays.

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David F. Carr
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David F. Carr,
User Rank: Author
10/11/2013 | 2:14:17 PM
re: PC Market Mess: 8 Takeaways
I wonder if there's a tendency for consumers to hold onto an existing PC or laptop longer (resist upgrading) if they are spending more of their time with their tablet, making that their essential device and the PC more of a backup.
Michael Endler
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Michael Endler,
User Rank: Author
10/11/2013 | 4:17:16 PM
re: PC Market Mess: 8 Takeaways
Absolutely. It's not that consumers don't buy PCs anymore; it's that PCs have become purpose-specific for many consumers, with tablets taking over general use tasks. That means a household that used to have three laptops might now have one computers and a couple tablets. The lone remaining computer will get upgraded less frequently while the tablets will be upgraded more frequently. This cycle will likely get disrupted again, to some extent, as phablets and wearables become more ubiquitous.
Laurianne
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Laurianne,
User Rank: Author
10/11/2013 | 4:32:45 PM
re: PC Market Mess: 8 Takeaways
This theory is 100% true in my household.
Lorna Garey
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Lorna Garey,
User Rank: Author
10/11/2013 | 5:06:10 PM
re: PC Market Mess: 8 Takeaways
And, there's the fact that as PCs become more powerful and higher-quality, they have longer useful lives. We just did some inexpensive upgrades to a six-year-old Toshiba laptop and it's running just fine. It's heavy, so no one will be carrying it around, but as a task device, it's great.
David F. Carr
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David F. Carr,
User Rank: Author
10/11/2013 | 7:51:34 PM
re: PC Market Mess: 8 Takeaways
I know Toshibas are supposed to be tough, but that didn't stop my daughter from busting the enter key on hers. May have had something about doing flips on the couch while balancing it on her lap.
mak63
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mak63,
User Rank: Ninja
10/13/2013 | 8:59:00 PM
re: PC Market Mess: 8 Takeaways
I agree with you. A few GB of Ram, some for the hard drive or an external one, and we're good to go. My main computer is a Pentium D, remember those?
My 2nd is a P4.
MarciaNWC
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MarciaNWC,
User Rank: Author
10/11/2013 | 9:21:33 PM
re: PC Market Mess: 8 Takeaways
I use my iPad for general daily stuff, and don't use my PC nearly as much, but still rely on it for actual work. Hopefully the less wear on my Vaio will make it last longer!
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