Market Overview

PC Industry Braces for More Declines in 2013

While the final numbers have yet to be revealed, PC sales were expected to decline last year. This would have been the first global decline since 2001.

At the time, almost all of the major notebook and desktop manufacturers were struggling to maintain the sales levels that they had experienced in 2011. Many of them, including Apple (NASDAQ: AAPL), Dell (NASDAQ: DELL) and Hewlett-Packard (NYSE: HPQ), were experiencing significant declines. Not even the refreshed MacBook Pro could prevent MacBook sales from dropping six percent.

These declines were surprising but they were not entirely unexpected. PC manufacturers are quickly learning that their industry is no longer the multi-billion-dollar behemoth it once was.

Many analysts have blamed this on the growth of tablets and smartphones. Some have argued that the economy has played a role in the demise of traditional PCs. Others believe that the power and reliability of Intel's (NASDAQ: INTC) Core 2 Duo and quad-core processors have allowed consumers to delay their upgrades for a few years.

Truth be told, all of those things are hurting the PC industry. While computers previously advanced so quickly that consumers (and some businesses) were forced to upgrade frequently, that is no longer the case.

Microsoft's (NASDAQ: MSFT) long-awaited operating system, Windows 8, was expected to change that. However, consumers do not want to buy another PC -- they simply want to upgrade to Windows 8.

This is good for Microsoft, which heavily promoted the fact that its new OS can make older machines run faster. It is not, however, the result that PC makers were expecting.

Some investors might think that Apple -- which has its own OS for Macs -- should not have been affected by the downturn of PCs. But Macs compete in the same market as tablets and Windows-based computers. Thus, they are facing the same challenges.

According to DigiTimes, PC manufacturers are bracing for another "difficult year" for the industry.

"Although PC players are aggressively promoting their Windows 8-based devices at the show, their focuses are mainly reducing costs, instead of releasing of new innovations," DigiTimes reported.

Indeed, the 2013 Consumer Electronics Show is devoid of ideas for new kinds of PCs. Some manufacturers have introduced concepts for a 20-inch tablet, but Sony (NYSE: SNE) beat them to it last fall. Panasonic (NYSE: PC) did build a 20-inch tablet with 4K resolution, however, making it the smallest Ultra HD display available.

Aside from larger tablets and hybrid PC variations, CES is mostly filled with Ultra HD television sets and an overabundance of displays from Hewlett-Packard, indicating that even the biggest PC makers are afraid to develop new PCs.

Follow me @LouisBedigianBZ

Posted-In: Apple DELL hewlett-packard Panasonic SonyNews Rumors Tech Best of Benzinga

 

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