Yesterday Gartner released a report that worldwide PC shipments fell in the first quarter of 2011. As I read over the article I couldn’t help but compare this current state of the PC industry as a whole to that of Puget Systems, but before I get into those thoughts, here’s a key excerpt from the article:
“Weak demand for consumer PCs was the biggest inhibitor of growth,” said Mikako Kitagawa, principal analyst at Gartner. “Low prices for consumer PCs, which had long stimulated growth, no longer attracted buyers. Instead, consumers turned their attention to media tablets and other consumer electronics. With the launch of the iPad 2 in February, more consumers either switched to buying an alternative device, or simply held back from buying PCs. We’re investigating whether this trend is likely to have a long-term effect on the PC market.”
I think Kitagawa makes a great point and we have been saying the same thing for quite some time here at Puget Systems. Take a look at our product line and you’ll see that in a tangible way. One of the first things you’ll see in our product line is that we don’t try to compete with the $500 Walmart computers. We have predicted the decline of that market for a while now and as technology advances and things get smaller, it seems like the way of the tablet is inevitable. Why deal with a big old computer rig for just sending email and browsing the internet when you can now interact with a similarly priced tablet that does all that just as well, travels wherever you go and weighs under two pounds?
Kitagawa asks if this is going to be a trend that effects the entire PC market. I think the best response is: “It depends.” For the sub $1000 computers, the writing is on the wall and it’s only a matter of time before that category of desktops are long gone, but that’s not the whole PC market.
During the same time period as this report outlines, Puget Systems has experienced some of best sales numbers in our history, and things continue to look positive – and here’s why: There will always be a need for the high-end. Highly specialized tasks will always require higher end computer power than mainstream consumer devices. Sure, the form factor might change, but the niche for the high end isn’t going anywhere anytime soon.
So what do you think? Do you think the custom PC market is fading away in favor of tablets or other handheld devices, or will demand continue to grow as tech gets more and more advanced?