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The end of the PC era

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For nearly 30 years, personal computers as we have known them have been the drivers of the technology engine. From Intel (s INTC) to Microsoft (s MSFT) to Dell (s DELL) to HP (s HPQ) to Micron Technology (s MU) — many fortunes were made on the back of the PC. But the rise of mobile computing is upending the technology business and is simultaneously redefining what is a personal computer and how we use it.

On Thursday Hewlett-Packard, one of the oldest companies in Silicon Valley with deep connections to the PC ecosystem (they paid $25 billion for Compaq in 2002) and the world’s largest seller of PCs, confirmed it is looking to sell off its personal computing business. It’s also getting out of the hardware game altogether, ditching its tablet and smartphone operations too. But if HP does eventually find a buyer for its PC division, it will only be catching up with IBM, which in 2004 decided that the low-margin PC business wasn’t worth pursuing.

HP is not the only company that is finding itself on the wrong side of PC history. Earlier this week Dell reported its earnings and acknowledged that its bread-and-butter PC business isn’t what it used to be.

But it’s not just those two. Annual growth rates for the PC industry as a whole have been shrinking in recent years, with small single-digit rates of growth. It can’t be inspiring for the manufacturers looking at their balance sheets.

Those companies looking to innovate won’t find much interesting about building PCs anymore either. Laptops will get faster processors, and marginally thinner. HP and Dell, along with the other top PC companies by volume (Acer, Lenovo and Toshiba) build essentially the same computer, with the same software, chips, and hardware. The only thing to scrap over is minor design flourishes and who can price theirs the cheapest–not exactly an inspiring business if you’re interested in being a part of mainstream personal computing advances. Or, for that matter, growth that will boost your stock and keep investors happy.

Meanwhile, the rise of alternatives to traditional PCs, tablets, continues its march on. UBS recently upgraded its already-optimistic tablet forecast for this year, to 60 million tablets from 55 million, and next year, to 90 million units from 80 million. And it’s not just shipments. People are buying them.

We’re not looking at a complete takeover of PCs by tablets. There will still be several hundred million PCs sold worldwide for several years because people will still need PCs for certain tasks. But it’s very clear that many of the habits we associate with personal computers can be carried out with a decent-sized touchscreen and a good internet connection. And better yet, done anywhere, and quickly.

Before all of these signs became unavoidably obvious, the other original PC company was the only one that saw the end of this era coming and actually did something about it: Apple (s AAPL).

Over a year ago, Apple CEO Steve Jobs started heralding the end of the dominance of the PC, dubbing it the post-PC era. He compared PCs to special-use vehicles in June 2010:

“When we were an agrarian nation, all cars were trucks because that’s what you needed on the farms.” Cars became more popular as cities rose, and things like power steering and automatic transmission became popular.

“PCs are going to be like trucks,” Jobs said. “They are still going to be around.” However, he said, only “one out of x people will need them.”

Not coincidentally, this foretelling of “the post-PC era” occurred after the introduction of the original iPad. Jobs saw the device as the future of personal computing, while critics and skeptics saw it as little more than “a big-screen iPod touch.”

Nineteen months later, we see what the iPad has wrought: the iPad is a blockbuster hit (Apple’s sold 9 million this year, and 15 million all of last year), and has sent PC makers much larger than itself scrambling to come up with a response. Meawhile, PC profits remain low, and even the world’s leader in sales  is disinterested in continuing the slog.

So while the era of the primacy of personal computers in their traditional form is fading, they are not disappearing entirely. They’re just taking on a different form.

Thumbnail courtesy of Flickr user K?vanç Ni?. HP laptop image courtesty of by treehead.

86 Responses to “The end of the PC era”

  1. wondercomp

    Ok, half my comment was cutoff when I went to the log in screen apparently, but here’s basically the rest of my comment.

    I believe that it is the end of the post PC era, but I don’t think tablets will be the king of this era, I believe smartphones will. Think about it, and be honest. What do you use more, your laptop, tablet, or smartphone. considering that work is 8 hours, and the average person is probably out and about slightly longer than that, I’d say I use my smartphone more than any other device I own. The problem though, is 2 year contracts, that may actually halt sales, but I don’t think it will be enough to keep them from overtaking PCs.

    The author of the post, does wrong in emphasizing tablets, because lets face it. I doubt they’ll ever surpass pc sales. She should have instead emphasized smartphones as the kings of the new era. We’ll see if I’m wrong in a year or two, but remember erica, you can’t have it both ways. You shouldn’t count smartphones, and tablets together. They are separate device categories, and for good reason. Those are my thoughts at least. be honest with yourselves…

    • Hmmm. Very true… I have been waiting to replace my laptop with my iPhone for a while now. (I did for many tasks back in 2003 with my Sony Clie and its Targus folding keyboard.) Keyboard and large screen connection are the only things really stopping that. The software I want will come (XCode), but that’s not going to stop me in the move.

  2. wondercomp

    One thing that should be realised, when talking about tablet PC sales, is that those sales are most likely first time buyers of the devices. I believe that most likely people will realize that they didn’t get what they paid for out of the device. I’m not suggesting that sales of tablets, will stop completely, but I am saying that they’ll slow down. the reason I sold my iPad to my dad is because, its really just a single purpose device for me, I use my smartphone while I’m hanging out, and my laptop when at home. The only time I used my iPad was when I was laying in bed… that’s it

    • The same could be said for laptops before 1998. They are now the market leaders.

      Many used laptops only when ‘away’, and did their “real work” on the “powerful” machine they had on their desks. The same argument was used in the office. Back then the only time I used a laptop was when there was no desktop machine around.

      Now I use nothing buy laptops. Desktops are used only for those tasks that require multiple monitors, or the games I rarely play.

      Given a bit of time, the tablet will take over. It took laptops almost 20 years. Tablets will do it in much less time.

  3. Jimbo99

    HP is very much like IBM, they are looking for their Lenovo. It’s what is wrong with America, the leaders here are selling this nation to the highest international bidder. There was a day when selling technology off to communist nations was illegal, not it’s the way of the global economy.

      • Unless consumers are completely substituting their PCs with tablets, I don’t understand what’s all the noise about “Post PC” is. Sure, the PC margins are low, but so are the margins of Android OEMs. If you look at Windows 7 sales, one would look at “Post PC” era as highly exaggerated. Also, your report doesn’t say anything about Mac sales.

  4. Karen Frangulyan

    I am trying to imagine myself moving my work as a programmer to a tablet :) Or a designer moving photo/video editing on ipad :) Or a gamer who has a gtx 560 card but its era has ended…
    This is definitely not the end, as new technologies have developed the market is just started to give better choice for well defined types of computer usages – you don’t need a PC if you are just going to surf the internet and check emails. So I think everyone will just buy another additional mobile device – tablet or a smart phone for that purposes but still will have one pc/laptop at home for “more serious” tasks. Unfortunately my vision is limited to my surrounding that’s why I always think that everyone will have something “serious” to do. Even my wife, who does not usually go further than internet, sometimes likes to edit our family photos with photoshop so she wants to have a laptop at her hand…

    • Erica Ogg

      Totally agree! That’s why I said there will still be use cases for PCs, such as the work you’re talking about. It’s just that PCs in their current form are no longer the driver behind tech innovation.

      • Karen Frangulyan

        Yes, that is true. I guess nothing else is left there to “innovate” :) From that point of view it is definitely not their era now. However… you never know what militaries are developing right now – the real driver of technologies :)))

    • Your point is about available software, not form factor. True the software isn’t there now, but it will be.

      There is no “serious task” that a tablet doesn’t have the processing power to handle.

      • Lance C.

        Try writing a 400-page book or 10,000 lines of code on your tablet, then come back and tell us how superior the experience was.

        Try doing serious PhotoShop work without a precision pointing device (not a finger) or a large screen, then show us the results.

        Tablets have their uses. I have one; it’s fine for what it’s good for. It’s not good for heavy-duty work. You can’t carry a ton of bricks in a Tata Nano; you won’t want to try to write a book or control an industrial process with a tablet.

  5. Mike Campbell

    If I see anything coming it will be the end of Apple’s siloed approach to repair and support. The major downfall of Apple has been and still is the fact that getting one repaired is a complete and total pain in the arse. Until Apple takes that move to make its technology more available, affordable and interchangeable, the PC will always live on.

  6. Must have been an apple fan that wrote this article. HP is just following IBM’s lead. It is a far cry to indicate that Apple has won anything. There is a list of PC manufacturers still in the mix.

    • May be, but is the article incorrect? There may be other manufacturers, but for how long? Certainly not forever.

      Brylcream is still on the market. Isn’t the hair grease era over?

    • Very good article. I especially like the assertion that complexity “also tends to provide some assurance of its longevity”. That’s PCs in a nutshell, and I can believe the reason Windows has been so entrenched for so long. While initially it democratized computing, now it’s simply trapping users to assure its longevity. Tablets, as MS has basically ignored them until recently, now stand to free us from Windows, and hopefully the link will to computers will be our data rather than the OS.

  7. As a developer do you think I am going to design and develop software on an IPhone or IPAD? There a millions of business applications running on LANs connected to database servers. My development environment has to simulate that environment. The “end of the PC era” reminds me of the “end of the mainframe” prediction of the 1980’s.

    • Lee Connor Williams

      It appears people are too stupid and biggoted to remember the business side of things simply because they’re called “PERSONAL” computers. I honestly can’t see a company using Ipads at workstations. At all.

      • Agree, totally!
        Myself, being a fashion illustrator/graphic artist cannot see it either… for a multitude of reasons. One day maybe but probably not the very near future.
        Harddrive space, size of screen,extensions, being key features. Seeing as how the laptop can be used for all things, work, entertainment, play..etc the tablet by sheer design does NOT lend itself to certain things. So you can get external devices to accommodate those things.. Takes away from the portability of the gadget and defeats the purpose of portability. So I would never buy it, would just continue use my MacBook Pro.
        For the masses, people that just want to play, travel and entertain themselves, the pads are great!I take mine, when I do these things, too.
        But to draw, design… least not for awhile, if ever.
        They are companion pieces, for artist like myself..that create the things that you guys use.
        I love them both.. each has a purpose and will always in our lifetime compliment each other, at least for certain people!

  8. Tablets will rule. Cloud options will allow for virtual PC’s to do the heavier crunching and simply interface with the tablets. Truly the end of PC’s as the device in hand is not far off (< 5 years).

  9. Dave Williams

    PC vs laptop is beside the point. I can buy an iPad and an ereader, and an internet radio, and a good enough laptop on special for the price of one computer that met my needs 10 years ago. The need for a do-it-all workhorse is gone and I’m guessing that PCs will end up like lightbulbs: you choose the one that get the job done and is on sale.

  10. End of What?

    Funny quote by Jobs. Makes sense, but one of the differences is that the car manufacturers didn’t sit around trying to push “The End of Trucks” when it really wasn’t. Everybody just kept making their various types of automobiles and let the consumers decide what to buy.

    End of the PC era? I guess Apple needs to “update the store”, as I still see MacBook Airs, MacBook Pros, Mac Minis, iMacs and Mac Pros for sale online and at my local Apple store.

    And I guess I need to sell my MacBook Pro, so I can program Objective-C on my iPhone.

    • Armand Konan

      The MacBook Air will be less and less a PC machine as the next versions of OSX roll out. Lion is already running apps and is linked to an App Store. Slowly it’ll become a more powerful iDevice. MacBook Pros will become more powerful Airs… So just like other iDevices. Mac minis will be more used as a home server/media center. iMacs and Mac Pros will still be around but only used by pros just like trucks today.

  11. dougscripts

    You can say you don’t understand why people would use an iPad, but that puts you in the same neighborhood as HP, who didn’t understand how to build an iPad competitor; and which is not the same neighborhood the buyers of 24 million iPads live in.

  12. People seem to confuse “end of the PC era” with “end of the PC” this obviously is not the case. BUT it is the end of the PC as the heart of innovation and progress.

  13. Craig Sturdy

    I for one, will continue to buy PCs for the foreseeable future. My phone provides my social media on the move and as a programmer, can’t see much of a shift from a big-screened powerhouse along with a keyboard and mouse for that line of work.
    As for tablets, I’m still as of yet to see their attraction- Apart from the fact that they make the pretentious pricks of the world look even more pretentious. Surely a pen and paper is more efficient for taking notes than some horrible, awkward on-screen keyboard??

    • Lee Connor Williams

      Agreed, plain and simple! I’m never going to be typing on a virtual/touchscreen keyboard unless said keyboard is rather huge- and while the “pads” do have their upside, how likely are you to be mugged with a pen&paper than with a £400 piece of electronics?

  14. tim jones

    Rather than the end of the PC era, it’s the end of the masses-buying-your-PC-just-because-your-logo-is-on-it era; the masses, as in China, India, middle-America, not-really-Dells in North Korea. The PC is a commodity item, and it’s about building and selling the cheapest pirated Windows machine off of eBay, or at Santa Ifigênia.

  15. Tablets never will overtake pc’s. Tablets have some nice features, but are severely lacking in many other areas. There is no end of the pc era, except for hp.

    • Armand Konan

      They will. 90% of consumers or so are using computers to do email, Facebook and consume media content. Believe me, they will go even better with a tablet. Even workers. Road warriors, sales rep., etc are better with iPad.

    • How willing are you to bet your house on your assertion? I think you aren’t.

      Making a statement like that (“It will never happen”) means you can now join the ranks of those who predicted that the patent system would no longer be needed back in the 1800s, and that FedEx would never work… That CDs would never sell better than records… The list goes on and on.

      The more convenient the computing device, the more accepted it will be. You can’t deny that most people use laptops more than your desktops. Internet vs libraries. Cell phones vs landlines. And soon, tablets vs laptops.

      • Lee Connor Williams

        For your every day life, yes.
        For work, NO. Plain right simple.
        May I also remind you that upgrading smaller devices is much more of a hassle than it is to upgrade a desktop.
        You’re basing everything off of convenience. While yes, laptops/tablets are more convenient for the average home-use, they are NOT for working industry (HINT, business industry not included.)
        Desktops are only going to evolve in how they are designed and used. They’re NOT being replaced entirely.

  16. Jimmy Y.

    yep, the end of the PCs are near, just like the end of super computers, the end of the fastest computing powers and the most calculation per gazillion-nono-second race is over.

    Everyone, just shut off your PCs and go to tablets, do your debugging and programming on your tablets, or mobile smart phone…

    Carry on, nothing new to see here.

    • Lee Connor Williams

      Sorry, but I am certainly not doing 3D Animation on a portable device. NEVER. Nor do I expect to be told what to do. The PC era is not over. It’s only evolving. People use PC’s because of their performance and other qualities over those of pads/tablets/phones.
      I also do not see multi-monitors being used on a pathetic tablet!
      Second, Space Research centres are certainly not going to switch over to tablets either! SO please, use logic before being a fanboy.

  17. symbolset

    Making Windows PCs was already just not profitable enough to be worth the risks. Add in a dynamic change to mobile and disruptions like Apple and Android, and HP is right here. It’s just smarter to put your efforts to something more likely to be profitable and let others live on the bark soup and grass salad that’s on the PC table.

      • So… you get around the inability to use your device the way you want, by attaching an add on to make it more like the device you don’t want to use in the first place…

    • David Penick

      I can “write” a six page document on my blackberry, with just the built-in qwerty keypad… and my kids (age 7,8, and 12) can make me look like a beginner. Just wait til the next generation hits the market and has hardly used a full-sized keyboard in their lifetime.

      • Lance C.

        Just wait until the next generation is 40 and their thumbs don’t work anymore. Mr. Bamsen has a very valid point — pads are terrible writing tools if you write more than 140 characters at a time. And once your eyes are old enough to drink legally, you’ll notice how hard it is to stare all day at a screen the size of a hardcover book. So you add a keyboard and monitor so you can get your work done and not blind yourself in the process and voila! You have a desktop computer. The PC model may be evolving, but it’s a long way from dead.

  18. Steve Tapp

    I smelled this coming when I saw that HP was not interested enough in prolonging the life cycle of its printers after the un-earth-shaking advent of Windows 7. No one was minding the support forums who had solutions to the incompatibilities in HP’s software. It seemed all intelligent programmers had jumped ship. I resolved never to buy an HP printer again. Let alone a successor to the Quad-core 6600 box I bought from them.

  19. Miko Matsumura

    It’s not the end of PCs. Remember that mainframes are still the backbone of computing and we’re still using relational databases everywhere. It’s the end of PC growth.

    • Very well said. It will take years and years before things change on the back end. In this economy, to think a large company will jump ship and uproot it’s backbone is absurd. If anything, laptops get smaller and more applications are run on servers. It will be a fight of who can utilize bandwidth best, not who makes the best hardware. It’s a new era, not the end. I’m excited.

      • Armand Konan

        It’s the end. Over. Give it 10 years and it won’t even be available for the general public.
        Yes, mainframes are still used but as a backbone, like servers, switches, routers, etc.
        Think a little bit about SJ’s analogy. Do you know a lot of consumers who drive trucks? They buy cars.

    • Who makes mainframes anymore? Banks don’t use mainframes anymore. Google, Yahoo, Amazon, Apple, eBay, Twitter, Facebook, etc certainly don’t. Aren’t you talking about headless PCs mounted in racks with server software (Linux)? They are still PCs.

      • Slavko Glamocanin

        Hey, good idea! Servers are next to change. I foresee ARM or something similar (simple architecture) going for it, low power, low cost, clustered “mainframe”. So instead of a 1KW quad proc server you have 40 low power nodes, clustered.

        I think somebody made this with Intel Atoms, we’ll se how Nvidias kal-el works out.

  20. The PC changed the data center of its time[Mainframe based]. The PIPM (Personal Information Processing Machine) will change the data center from now on. If these companies believe they can run without R&D like they did for a long time during the PC era, they will be in for a rude surprise. Software has a low entrance barrier, if consumers [workers] make buying decision once again, HP/Dell will become DEC. Old ERP system thinking will not get you to far, because that will feel and act like JCL (Job Control Language, for the kids). Or these guys in the white coats never get anything done.

    • mustapha derras

      well zone :-) same players makei sa mes mistakes. The more we will want to distribué lergely a technology the more the innovation effort will increase involving a bigger R&D effort.

    • Dell & HP had R&D. It was focused on how to bring down the costs of distribution and manufacture – PCs used to cost thousands of dollars. These companies aren’t stupid and lazy – what they do well isn’t valuable enough anymore to generate high margins.

  21. Great article — I also blogged about this today as well: “The Upheval of Technology aka Happy Birthday PC!”

    It is exciting but frustrating for the larger designer and developer community to embrace change of this level. New technologies, new workflows, and new platforms are changing so quickly–with company strategies changing at the same time.

  22. Interesting that you mention IBM in your post, Lenovo having just announced very good profits.

    I think the claims that we’re at the end of the PC era are a bit premature. At their heart PCs have always been about cheap flexible components that allow a PC maker to build computers into any form. Far from this being the end of the PC era I think we’re just at the start of an even more diverse PC era. Microsoft is just starting to talk about its new version of Windows that puts touch front and center.
    It is also understood that Windows will work on ARM architecture which should allow devices that match the iPad in size and weight yet offer a full PC experience when plugged into a monitor and keyboard.
    Add into the mix Intel who have been talking about their ultrabook platform and thunderbolt technology that could perhaps allow a tablet pc to be plugged into an external graphics cards enabling desktop like performance and things certainly look like they could become very interesting. In your post you mention Apple having sold 9 million this year which is good especially at the margins they make but it’s not even in the same league as the 175 million copies of Windows 7 sold in the first month that it went on sale. If even a fraction of that number of copies of Windows 8 go onto iPad like tablet machines when it is released next year then I think far from the end of the PC era we’ll be seeing a very different story being written here.

      • Now why should THAT be a surprise. It has been happening aggressively for the last 60 years. It is about increasing the bottom line each and every quarter so that they can get their bonuses. Now that is true patriotism…to the corporation. Screw the country when the worker bee eventually is not in our system and generating tax dollars. But the pendulum swings back and forth, unfortunately the trip takes a very long time.

    • “I think the claims that we’re at the end of the Horse and Cart era are a bit premature. At their heart Horses and Carts have always been about cheap flexible transportation that allow a Horse and Cart seller to provide transportation or any need. Far from this being the end of the Horse and Cart era I think we’re just at the start of an even more diverse Horse and Cart era. Mr. Big Horse and Cart Seller is just starting to talk about its new Horses and Carts that put speed and capacity front and center.”

      “In your post you mention SuperCar having sold 90,000 this year which is good especially at the margins they make but it’s not even in the same league as the 15 million Horses and Carts sold in the first month of this year.”


      What happened to the horse and cart industry? How long did it take?

      Making comparisons of already established markets to new emerging markets is a fallacy that has been disproved so many times, you really should ow better. No matter how much you believe in the PC market, the fact is it is changing.

      PCs are commodity items, and with profit margins so low, there is no company willing to innovate anymore. IBM, probably the only innovator of late, is gone. Intel is innovating, but only to try to retain customers. The need to constantly upgrade, which was the main computer sales driver years ago, has ended. We no longer need to upgrade to do what we want.

      More people play games on consoles than on PCs today. The console life cycle is, what, 5 years?

      In recent history, people have denied the death of their pet industries:

      Horses and carts usurped by cars and trucks.
      Outdoor toilets replaced by indoor plumbing.
      Steam locomotion usurped by diesel.
      Radio usurped by TV.
      There’s only need for 5 computers in the world.
      Japanese cars will never sell as well as American.
      Home HiFi usurped by transistor radios
      Records usurped by CDs.
      Portable cassette players usurped by MP3 players
      CD sales trumped by digital music downloads.
      TV usurped by YouTube.

      If you look back through history, you will find many “experts” claiming that the new market would not have any real impact for a long time or even ever. They have all been proven wrong. This one will be the same. It was predicted as far back as 1990. Now, it begins.

      • Yes your horse and cart nonsense is very interesting but misses the point. I didn’t suggest for a second that the form factor isn’t changing. What I am suggesting is that the iPad has had only moderate success compared to the PC (so demand for PCs is still high) and that if a consumer is given the choice between a tablet pc that can do everything a computer can do AND everything an iPad can do OR just an iPad they may well choose the PC. Of course the jury is still out as to whether MS can make a UI that can bridge the gap between the UI of old Windows with the UI of a good touch based tablet but I think it is Microsoft’s market to lose rather than the forgone conclusion that some people seem to be suggesting.

  23. If it’s the end of the PC era, it’s also the end of Intel era, and Windows’ future is still uncertain. We’ll see how it goes for Windows 8 into 2013. On ARM they also have to start from scratch, and they’ll be late to the party again.