The PC market has suffered its biggest decline on record, with first quarter shipments dropping 14% since the same time last year. This unprecedented decline casts a very ominous light on the PC industry, which had hoped that Windows 8 would bolster sales -- but instead, Microsoft's new OS is a major factor in the most precipitous decline in history.
These figures come from IDC, which has been tracking PC shipments since 1994. Shipments (not sales, which were probably lower) of PCs in the first quarter of 2013 totaled 76.3 million, down 13.9% from the first quarter of 2012. Gartner, which has a slightly different definition of "PC," pegged the decline at 11%. Among the individual PC makers, every OEM except Lenovo experienced a decline in shipments. HP's PC department, which has been flagging for some time, experienced a huge drop of 24% compared to the same time last year.
The PC market has been steadily declining over the last few years, but a slump of 13.9% was really quite unexpected. IDC, which is usually fairly accurate, had predicted a huge drop of 7.7%, which would've also been one of the largest declines in history -- and yet, somehow, it the actual damage was almost twice that. If this decline continues, the PC market will be all but dead in the next few years. (See: Microsoft quietly kills off the desktop PC.) Just so you have some idea of how dramatically the PC market has been eclipsed by the smartphone, get this: Samsung itself sold in the region of 70 million smartphones in Q1 2013; almost as many as the entire PC market combined (76.3 million). All told, analysts expect over one billion smartphones and tablets to be sold in 2013; PCs, on the other hand, will be lucky if they shift 350 million.
The droop in the PC market also caused a big drop in the semiconductor market, with Intel, AMD, and other PC-oriented chip makers all taking a hit. On the flip side, mobile chip suppliers such as Samsung, Qualcomm, and Broadcom, all experienced huge growth. Nvidia, which has successfully diversified into mobile chips, managed to grow by 6%. Intel, which is massive in the enterprise and HPC space, declined 2.7% -- which it no doubt hopes to reverse this year, with the release of its new mobile Atom chips.
Did Windows 8 cause the decline? We will never know for sure, but given Microsoft's opaqueness when it comes to Windows 8 sales figures, poor sales of Windows 8 tablets such as the Surface, and the continual disappointment surrounding Windows RT, it's definitely fair to say that Windows 8 is a large factor of the PC market's decline. According to IDC, many businesses chose to install Windows 7, rather than Windows 8 -- and, in the consumer space, the absence of the Start button and the need to switch between Desktop and Metro modes is turning off potential buyers.
There are other factors, though. The worldwide economy, especially in developing economies, is still weak. There's just no avoiding the fact that PCs are being squeezed out by smartphones and tablets, too: No matter how appealing Windows 8 is, people want a new smartphone or tablet -- not a new laptop. (See: There can only be one: Smartphones are the PCs of the future.) Microsoft will get another chance with Windows 8.1 (Blue) to make Windows 8 more appealing on laptops and desktops, and thus boost PC sales -- but unless it's willing to back down on the mandatory mouse-and-keyboard-hating Start screen and welcome back the Start menu, that seems rather unlikely.
Now read: Windows 8: The disastrous result of Microsoft’s gutless equivocation
