Who is to blame for the PC sales debacle?

Who is to blame for the PC sales debacle?






January 8, 2019

The results are in, and for PC sales they are neither good, nor bad – but ugly! The pundits are out to find a scapegoat – and the most convenient scapegoat at the moment is Microsoft. For example see this report in today’s Wall Street Journal which hails Microsoft’s mea culpa.

There is no doubt Microsoft is partly to blame for the debacle. I am no fan of Microsoft’s ketchup strategy (constantly throwing money to catch-up with the successful rivals). On top of it the company itself admits that “The world is changing and changing fast, and frankly we also didn’t get everything we dreamed of done in the first release,” of Windows 8. The report quoted above goes on to say:

Windows 8, the operating software launched in October, was intended to catapult Microsoft and its allies into the market for new kinds of computing devices—including tablets—and help generally get consumers more interested in buying new personal computers. Six months after the operating software’s debut, it isn’t yet a hit by the accounts of some PC executives and research firms.

One market-research firm, IDC, went so far as to say that Windows 8 did more than fail to revive the PC market—it actually turned off users with changes to basic elements of the widely used operating system.

Ms. Reller disputed IDC’s contention, and said the company is seeing steady if not steep sales progress. She said Microsoft has sold 100 million copies of Windows 8 since October, up from 60 million in January.

However, let’s pause to think about it for one moment. What about the roles of hardware vendors – HP, Dell, Lenovo, Asus, Acer and others. What have they done to create products that consumers would like. Where is the innovation in the hardware arena that would appeal to the customers?

As I said in the comments to the above article:

I think it is wrong to blame just Microsoft or Windows 8 for this debacle in PC sales. As I discuss in my recent book The 5-STAR Business Network (http://www.amazon.com/The-5-STAR-Business-Network-Corporations/dp/061579419X/ref=sr_1_2?ie=UTF8&qid=1367705465&sr=8-2&keywords=vivek+sood) it is always the business eco-system that is responsible for the success or failure of a concept. The entire Wintel business network has failed to innovate to improve the customer experience much beyond windows XP. I am still using the same laptops with same programs with marginal improvement in speed. Apple, on the other hand, and Google/Samsung in its footsteps has created entirely new categories of products, as well as, improved the customers’ usage experience much better. If you want to look at the success of a product or concept, look at the Business Network that works behind the scene to create the user experience – not at an individual company.

In a previous blog post I spoke about Intel’s role in this picture. Here is what I wrote at that time:

No doubt, the continued softening of the PC market is not only hurting HP and Dell, but also partly responsible for what is happening at Intel. The key question is that while Intel is extremely good at Advanced Product Phasing (APP), is it capable of proving itself adept at Fire-Aim-Ready (FAR) Innovation? Without innovation, and creation of new product for where the market is moving too – cloud based mobile gadgets, Intel is likely to continue to lose ground.

Troubles at HP continue to make headline news with regular periodicity. Dell is not immune to such news either. Lenovo is now thinking about selling its low end server business. The fact remain that the business model is changing again. Cloud is doing to Wintel, what Wintel did to AS400’s. The entire Business Network must move in line with this changing business model. Those companies who can configure a new 5-STAR Business Network that fits in with this new business model will prosper. The rest will continue to look for scapegoats.

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  • There is no doubt in that your 5-star business network book is very useful it is always the business eco-system that is responsible for the success or failure of a concept it’s concept is very appreciating.

    The PC industry has continued to be stuck in the doldrums throughout 2018, but the pain of the industry’s contraction over the past six years hasn’t been felt equally by all vendors. For those following along at home, the PC industry has been shrinking since tablets became popular in 2011. That year, a total of 365.36 million PCs were shipped. In 2017, just 262.54 million units were shipped. The nearly 30 percent decline hit hardest in the early years — sales figures in 2017 only declined slightly from 2016, and 2018 is only slightly lower than 2017 thus far — but it had profound impacts on the market. One of those impacts has been the decline of a number of smaller system vendors.

  • I’m a fan of Microsoft but after reading your content regarding its business values, I think I was wrong. Microsoft has a big player of computer market but it has slow innovation towards the product.

  • Quite an informative article. The PC market is still declining, few years were drastically negative, but it cannot be decided clearly who shipped more PCs: HP or Lenovo. As with the proceeding year, Dell was indisputably third. Both HP and Dell continue to be optimistic about the PC market, despite more quarters and years in the red than in the black.

  • Microsoft put a lot of effort into ensuring that the operating system and application updates, and hardware devices they deliver to your system are secure so that hackers can’t hijack updates to get into your computer. But it turns out that PC hardware makers are not so careful. HP, Dell, Acer, Lenovo, and Asus, found that all had serious security problems that would allow attackers to hijack the process and install malicious code on victim’s hardware machines.

  • While going through a report, relevant to this post, I would like to quote a few interesting statistics here. The report estimates worldwide PC shipments fell 4.3 percent to 68.6 million units in 2018. The top six vendors were Lenovo, HP, Dell, Apple, Asus, and Acer. The report found that only Lenovo and Dell increased its PC shipments. HP, Apple, Asus, and Acer shipped fewer computers. The rest of the market was down 12.9 percent. It can clearly be estimated that who is leading the PC market and who is contributing to PC debacle.

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