A report from analyst company Gartner said that the traditional PC market will slip in 2013 by 7.6 percent as people open their wallets to spend on tablets and smartphones instead.
Gartner said the availability of low end tablets coupled with the features they’re now able to offer is fueling the move from PCs to tablets. Said Carolina Milanesi, research vice president at the company: “While there will be some individuals who retain both a personal PC and a tablet… most will be satisfied with the experience they get from a tablet as their main computing device.”
Worryingly for PC vendors and X86 companies, people no longer think of PCs as devices that they have to replace regularly.
She said: “This is not a temporary trend induced by a more austere economic environment; it is a reflection of a long term change.”
Gartner estimates that worldwide tablet shipments will be 197 million units this year, a 69.8 percent increase.
And the Android operating system is set to dominate a mixed market which includes PCs, as this chart shows.
Gartner said that smartphones are becoming more affordable. “The trend towards smartphones and tablets will have much wider implications than hardware displacement,” Milanesi said.
While the humble desktop PC emits a death rattle across Europe, consumers are flocking to tablets – devices which tend to be much more comfortable to keep on your lap when channel surfing.
According to analyst house Context, tablet sales have increased an enormous 350 percent in a single year, proving a boon to retailers who had the foresight to invest in the devices. Global MD of retail research at Context, Adam Simon, pointed out that there is a shift away from online-only retail channels, giving bricks and mortar stores the opportunity to capitalise while the consumer embarks on its cheap-and-cheerful tablet frenzy. Amazon is an example, which now stocks the Kindle in regular stores.
Click and collect is an emerging trend which is also helping the traditional retailers. Rather than waiting for the postman to stealthily drop in a “Sorry you weren’t at home” card in the nanosecond he or she was at the door, customers order online and pick up their product from a designated site. This is a pretty neat option because you don’t need to take a week off work to make sure you catch your delivery. Argos has enjoyed success with this model.
Of course, Apple is still very popular, but Context pointed out that top tablets in Western Europe also included the Samsung Galaxy Tab 2 7.0, the Galaxy Tab2 10, and the Nexus 7. Samsung’s laughing.
Context tablet analyst Salman Chaudhry said in a statement that Apple’s show and play concept “was a real leader and taught consumers to enjoy experiential purchases while also creating links between their own stores and other retail outlets”.
“Various tablet vendors are now following these footsteps by making more devices available in stores for people to trial before they buy, with even Google getting in on the act with their stands in PC World,” Chaudhry said.
Acer is taking a beating on the back of a slow PC market and fears that it expanded too much, too quickly.
The Taiwanese outfit is the fourth largest PC maker in the world, and it peaked in 2010, when it briefly ranked second. However, things have gone downhill and on Wednesday Acer announced it expects to post a full-year net loss for the second consecutive year. It is also looking at a $120.1 million write-down on several value brands under its umbrella.
During the PC boom in the late nineties and early 2000s, Acer went on a massive shopping spree and picked up a number of value brands, including Packard Bell, Gateway, eMachines and E-Ten. The write down on said brands dragged Acer to a net loss and the company plans to discontinue the eMachines brand altogether.
Other PC makers are facing similar challenges, as they struggle to reinvent themselves and gain a toehold in emerging sectors, like smartphones and tablets. Acer has a small presence in both sectors.
The company’s phone business is practically negligible and its attempt to expand its presence in China in 2012, with smartphones based on Aliyun, a heavily customized Android-based OS, was promptly ditched after Google threatened to cancel the company’s Android license. Acer had a bit more luck with Android tablets and it is moving into the Windows 8 tablet space as well, but its efforts have been overshadowed by the likes of Asus and Samsung.
Even as it struggles to remain competitive in the PC market, burdened by underperforming value brands, Acer prospects in the heavily contested smartphone and tablet markets look even bleaker.
Brokerage houses Nomura Holdings and UBS are anything but optimistic and UBS cut its target price and maintained the “sell” rating on Acer stock after the report. Nomura was somewhat kinder, but it also maintained its “reduce” rating on Acer, Taipei Times reports.
“Longer term, we think Acer still needs to face the reality of how to rebuild the brand positioning/image for Packard Bell and Gateway amid intense competition and slowing PC industry growth,” said Nomura analyst Eve Jung.
A market research company said that tablets are set to cannibalise more PC sales as their popularity continues to grow.
ABI Research estimates that 145 million tablets will ship this year, with 50 percent of sales outside the USA. Price, new entrants to the market and increased shipments into enterprise will help drive the growth.
Business sales will account for as much of 19 percent during 2013, and a variety of slates using Intel chips and Windows 8 will begin to make more impact this year, according to Jeff Orr, senior director at ABI.
Meanwhile Israeii company Perion said it conducted a survey of 4,400 iPad users about how they used their machines. Ninety percent of those surveyed said they used their iPads to read and write email.
Women are more likely to read and write emails from their pads, while the favourite app is Apple Mail at 41 percent, Gmail at 31 percent and Hotmail at 13 percent. Eighteen percent of people use browsers to access webmail rather than using clients.