Industry monitoring group Gartner has sharply lowered its growth forecast for PC sales from 9.3% to 3.8%, and has trimmed their 2012 forecast to 10.9%, from 12.8% citing a stagnant economy and explosive growth of tablet computers.
“Western Europe is not only struggling through excess PC inventory, but economic upheaval as well,” said Gartner research director Ranjit Atwal.
“US consumer PC shipments were much weaker than expected in the second quarter, and indications are that back-to-school PC sales are disappointing.” Atwal said. “Generation Y has an altogether different view of client devices than older generations and are not buying PCs as their first, or necessarily main, device.”
These changes in consumer preferences have caused many PC manufactures to drastically rethink their strategies going forward.
“Media tablets have dramatically changed the dynamic of the PC market and HP’s decision to rethink its PC strategy simply highlights the pressure that PC vendors are under to adapt to the new dynamic or abandon the market,” argued George Shiffler, research director at Gartner.
However, the end is not night for the PC market. Given the stagnant economy many firms are choosing to tighten spending and forgo purchasing new computers in favor of upgrades. In order to remain profitable during these challenging economic times, Gartner suggests that the business model of the PC vendor has to change.
“The business model of PC vendors has to change. It used to be about low prices, high volumes and low margins. But the model is breaking down because they no longer have the high volumes,” Atwal said.
“Apple has shown the way but we will have to see if other companies can follow.”