Windows 8 causes most precipitous PC decline in history

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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.
Microsoft's used car salesman approach to selling Windows 8

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

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  • http://twitter.com/sheinavi Sheina Vi

    Yes.. because maybe people already have computers because they bought just last year..? Or are they actually expecting people to buy new computer each year?

    • bertgoz

      That’s the point. If Win8 was attractive enought, some people would have bought a new desktop PC

      • http://profiles.google.com/ariemeth Edward Carmack

        And some people did buy new machines because Windows 8 was released. The problem is that computers have saturated the market. Just about everyone in a developed country that can afford one or two or three already has them and they don’t have a reason to upgrade. It takes an insanely awesome feature to get someone to upgrade an “appliance” when the old one still works, and that is what computers have become. They are now more like an appliance, you buy it and keep using it till it breaks, then you get a new one. The days of constant upgrades and new markets to fill is behind us.

  • http://www.facebook.com/profile.php?id=782418982 Stuart Bunn

    How can this be attributed to windows 8 alone? The title is a bit misleading since traditional PC’s sales have been declining for years

    • Paul Humphreys

      Agreed. Sebastian Win8 sensationalism again. Title should really be “Gluttony of smart phones and tablets causes expected record decline in PC sales”. But that wouldn’t get people to read the article quite as readily. I, in fact, didn’t even read the article because of the title.

      • AFK-Dreaming

        But you did read the article? Because I’m sure I didn’t line up to buy a laptop or desktop last year because it had Ubuntu installed on it. Do you happen to have a special relationship with the hardware on your pc, because, I have to be honest, I use the hardware to drive the software and it’s usually the software that I’m interested in. So, if the defacto operating system for pc’s isn’t responsible for the lack of enthusiasm about a pc, what is? I’m not sure about you, but I still use a pc at work and a pc at home. Let me know when you have 100% functionality with every piece of software on a tablet and I’ll acknowledge that the day has arrived when the pc is no longer relevant. Until

        • http://profiles.google.com/ariemeth Edward Carmack

          How about the fact that there has been a huge surge of people using their phones for most of their daily computer needs, media consumption and social networking. I don’t think anything Microsoft or anyone else could have done to keep these numbers from going down the way they did. People just do not have a reason to upgrade. Windows 7 machines are still working excellently. Most consumers don’t care about upgrading just because the new OS is out unless they have an issue with how their current system is running. This as well as the downward spiraling usage desktop and laptops are actually getting, this was bound to happen.

      • http://profiles.google.com/ariemeth Edward Carmack

        I’m getting good at this. I saw the headline and new it was Sebastian before I even clicked on the link.

  • http://www.facebook.com/ruel.celerio.9 Ruel Celerio

    It is true that the disappointment with Windows 8 is one of the factors in the Q1 decline in sales of PCs. But then historically Q1 always demonstrated the lowest point in sales of PCs. I’d like to add though that a lot may be holding back in their purchases waiting what Haswell has to offer. Google’s Chrome may reveal something too mid this year. We need to count in also that a lot may be holding back waiting for prices to lower down further for Windows 8 especially around the start of classes and the promised new PCs exhibited by different manufacturers at the CES are only starting to trickle down in Q2.

    While I agree that smartphones will be more powerful that PCs in the future, but what’s trending, and a reality happening right now, is that productivity have moved to tablets.

  • msbpodcast

    Microsoft’s traditional market is the enterprise. Those folks dont spend a dime unless it can be justified and you get bonuses as manager based on what you DON’T spend. Don’t look for any help from enterprise.

    Windows x doesn’t matter a damn.

    • TheOtherTurnipTaliban

      We’re in a recession, enterprises do most of the big ticket PC purchasing, PC declines by 13%. Author blames Windows 8…

      D’oh.

      • xxcorpxx

        Yup, we shifted to a 4 year rotation on Laptops and 5 or more on desktops this year. NO new PC’s aside from new hires. It sucks, 3+ years on a laptop is asking for trouble. But, it is what it is.

  • http://www.facebook.com/ian.skinner.9 Ian Skinner

    My own reasons for not doing any upgrades and I think this is a large part of why most are not upgrading, the ‘next big jump’ just hasn’t happened; GPU speeds are not that much better then they were 2 years ago, CPU performance and Motherboards again not really anything spectacular. only thing I’ve added is HD space and even that’s stalled out in terms of size jumps. Windows 8 may well be a part of it, but I think the real culprit is Moores law.

  • http://www.facebook.com/profile.php?id=1345434040 Demond Edwards

    What Microsoft should do is to have two versions of Windows 8, one for touch screens which would give you the Metro tiles and one for non-touch screens, this one will present the user with the familiar Windows 7 desktop look as the default. I have Windows 8, but the minute I log in, I go directly to the “desktop” view and rarely use the Metro tiles. They are pushing a “touch” product to consumers that do not even have touch monitors, this is like selling someone car tires when they don’t even have a car. If not two versions, just disable Metro during setup to have the desktop environment as the default.

    • AFK-Dreaming

      Why would I want to buy Windows 8 if not for the new interface? You’re basically saying that everything should stay the same as Windows 7 in a “non-touch” environment. So, why invest the extra cash when it’ll do basically the same thing as the older, cheaper (as in already have it) software?

      Bottom line – Microsoft has been charging people through the nose for marginal improvements with every iteration of Windows and now they’re starting to realize that nobody wants their next round of crap having already invested in the previous one. Enterprise licenses are expensive and no organization wants to buy yet another round of software just to update to a new version of Office in the bargain, especially not one which would require some of the older employees to be retrained in just using the freaking software.

    • http://www.facebook.com/brunnegd Gary Brunner

      You don’t understand. MS knows what you need much better than you do. Just ask them. :)

  • meddle0ne

    I’m curious to know if these figures include convertible’s or the other new W8 designs. The sales haven’t been huge but combined from all the manufacturers, I’m sure the lack of inclusion of those designs would skew the numbers.

  • jason parks

    There is no reason to upgrade a computer, has nothing to do w/ OS
    Mine is 3-4 years old, I7 CPU , Solid State HD, 8GIG of ram only thing i did upgrade was my GPU to a HD radeon 9750 cost me 280 but i got 2 60 dollar games now it last me another 3-4 years. Windows 7 works

    There is no reason to get another computer my cpu never goes past 4% usage only use 1/2 the ram.. Hardware is so far ahead of software, and OS shouldn’t push the envelope of hardware.

    But PCs are not dead, i use them at home and work, but there is just no reason to upgrade.

    • TheOtherTurnipTaliban

      I think a general plateauing of everyday PC performance certainly plays a part in this fall. Especially with SSDs now, if you have a half way decent processor, some cheap as anything RAM, and an SSD drive? You’re pretty much set. Kind of hard to slow down PCs with anything but heavy gaming and 3D design nowadays. I certainly don’t feel like there’s a huge leap up in performance from where I’m at now (8gb RAM, i5 2500k@4.4Ghz, GTX 660)

    • xxcorpxx

      I agree – I buy myself a new work PC every year and I didn’t bother for the last two because mine is fast as hell still. I dropped an SSD in it this year and Windows 8. I don’t need a new PC and I really really really want one. Maybe next year.

  • TheOtherTurnipTaliban

    Dude… talk about confusing cause and effect… when people aren’t starting companies or making new businesses, surprise surprise, they don’t tend to buy s***-tonnes of PCs combined with an unnecessary OS upgrade. I’d be surprised if PC purchasing HADNT fallen precipitously, never mind being gobsmacked at this fall.

  • wp77

    I’d say Intel is as much to blame. My PC is a 2 yr old i7 @ 4ghz, SSD drives, 16 RAM, etc. The current CPU’s do not offer enough of a performance boost to justify upgrading my system. Has nothing to with Win8.

    In fact, I installed Win8 on my older PC’s to breathe new life into them; and inadvertently didn’t have to buy new machines.

  • davelalande

    Why upgrade or replace your PC if all you need is a browser. The cloud is the future.

    • http://www.facebook.com/brunnegd Gary Brunner

      The only place I want clouds is in the sky, as I lie in my hammock and watch the thunderheads form in the summer.

      • davelalande

        This is exactly how Steve Ballmer thinks. I feel bad for people that can’t accept the inevitable. It really doesn’t matter what you or I think Gary, the math is the reality, we are headed for the cloud. I think it’s a good thing, but it doesn’t matter what I think, only what is.

        • tgrech

          The cloud can’t deliver, and never can deliver some of the most important uses of the PC, although eventually most average consumers will be able to move to it easily, it simply won’t work for most enthusiasts and high end users, it’s extremely unlikely it’ll be successful with gamers as well. Even then, it’s a long way off until latency isn’t an issue, and it becomes financially viable.

          • davelalande

            The cloud continues to deliver even some of the stuff you’d think was relegated to desktops. Yesterday there was an article on Mashable that read, “Lagoa Puts Pro-Level 3D Image Tools in the Cloud”.

            I haven’t used MS Office in a couple of years thanks to Google Docs. It allows me to real-time collaborate with colleagues and offers a very powerful scripting language as well as APIs to accomplish more sophisticated tasks. I recently developed a great data visualization project using Google’s Visualization API and Javascript. Crazy powerful stuff and saved us a small fortune not having to buy a solution.

            Google and AT&T are now going to compete for Gb Ethernet clients in Austin, TX, this will continue and as gigabit networks unfold around the nation, desktop gaming will be disrupted.

            But again, tgrech, my message is that it doesn’t matter what we think, the math says we’re headed to the cloud. We will still need PC’s for some tasks but the number of tasks are shrinking and much of it is happening in a browser.

          • tgrech

            Even if it does come eventually, I think it could be a while off, most people are lucky to get 30ms latency at the moment with most servers, numbers much higher are much more common, that needs to change massively before a lot of tasks can be considered (Especially gaming), I also expect it’s going to be quite a while until streaming 1440p@60hz is possible for most people(Even 1080p@30hz is quite uncommon for the general consumer to be able to accomplish live).

            There are also big security issues with the cloud, it’s a very insecure platform, it can be hacked, DDoS’d, and stole from relatively easily. It’s also hard to trust many of the companies that run these(Google has been under attack a couple of times over their data collection and lack of respect for privacy), also it’s not common here but I’ve heard in America internet is still only around 98% reliable, and it’s not uncommon for ISPs to track, record, analyse, block, alter and throttle whatever they want.

            It’s also not really financially viable yet, to pay for internet fast enough to use good portions of the cloud reliably and comfortably, while subscribing to the cloud services as well, you would Normally, (though obviously, as you pointed out, not always) of saved money using standard internet and just buying the software/game/movie/ect.

          • davelalande

            The cloud is very secure. There is no platform that is 100% secure. The cloud providers have the best networks, people and security resources at their disposal than anyone on earth.

            Google’s network is extremely secure. The attacks have been phishing attacks (social engineering), not network breaches.

            If people understood how Google and other cloud providers actually store their data they wouldn’t second guess who’s got a better chance at keeping your data safe.

            Google actually breaks your files into little pieces, encrypts each piece and stores multiple copies of these pieces around the world in multiple data-centers When you ask for your file these servers reassemble the encrypted pieces and hand the file back to you. These servers are tuned to only talk to each other adding another layer of security sophistication most corporate IT departments will never achieve.

            Again, we can debate this stuff all day long and the math will tell the store. PC purchases and upgrades continue to trend downward. It doesn’t matter what we think, it only matters what is happening.

  • Alon

    I’m also holding my purchase of laptop for my wife, because I don’t want Windows 8. I can’t find new laptop with Windows 7.

  • http://www.facebook.com/brunnegd Gary Brunner

    My smartphone can’t do 5% of what I can do on my PC. And my tablet isn’t much better. Start with the lack of an easily used keyboard and an overly sensitive drag feature that interprets my drag as a select. A pain. And the applications? No comparison.

  • Robert

    Title of article “Windows 8 causes most precipitous PC decline in history”

    inside the article “Did Windows 8 cause the decline? We will never know for sure”
    WTF man? lol

    • xxcorpxx

      Yeah, i almost didn’t come and play today because I knew it was going to be a bash-fest with that title. I read the same news at REAL tech sites and they were only asking that question of whether Windows 8 played a roll or alllll the other factors.

  • http://www.jeffkibuule.com Jeff Kibuule

    Correlation does not prove causation, headline is misleading.

  • http://www.facebook.com/people/Bruce-Miller/100000952005408 Bruce Miller

    The Great Corporate American Propaganda Whores have taken an American character flaw – the tendency to want everything made immediately easy for them – and exploited it with
    software that does just that! And also robs Americas of the brain exercise needed to develop improve, rewrite, adapt and intelligently design their own specific programming. Somewhere, between numerical programming and popular software, lies programming languages like Open Source, Free, Public Domain, Python, code, code snippets, blocks of code, and systems that can be used to design your own specific software? America has foregone this huge area and adapted “Standardized Software” commercialized, patented, “secret”, and ‘for a price’, and is about to be left far behind by Asians who tried just a little harder to do better. The ‘P.C.’ Has shrunk, to a a very small device, has expanded in memory and speed, and now comes with cheaper, Asian built, cool running, light weight, low power consumption, ‘Flat screens’ with incredible definition and color, as the 20th century American styled Big Box and Vacuum Cathode Ray tube styled systems fade now to a simple keyboard and Flat screen affair that even includes touch screen features, built in sound and many other goodies once though impossible by American Design ‘Standards’ . Combining advancing electronics technologies with astounding programming capabilities of the masses in Asia, we arrive not at the end of the P.C. persay, but at a new beginnings in the Global Village for this medium.

  • doubledeej

    It can’t all be Windows 8. Mac sales dropped by 8% as well.

    • LZKashmir

      Agreed. I hate Windows 8, but I’m not going to blame it for a slump in sales. PC sales are already trending down, the economy sucks (in my opinion), and our tax situation remains unstable…companies and consumers are just holding off on a lot of stuff these days.

  • Max

    The first thing Microsoft should do is fix the software and then start almost giving it away. Better to flood the market with free software then to become irrelevant. Ask Google. They gave it away for free and now dominate the world market. Change the business model. Also, make your hardware like the Surface, with the best specs and rock bottom prices like Samsung and Nexus Tablets and phones. You wan’t to compete, you better act fast!

  • Alfiejr

    yes, Windows 8 is a huge flop, but no, it did not cause the big drop in PC sales. the drop would be the same if there had been no W8 at all and the popular W7 (with some good updates presumably) were still the current PC OS.

    because the consumer market is abandoning everything Windows now – and forever. it’s just over. Windows/PC’s are inherently and intrinsically big and complex, but the future of consumer computing is clearly focused and simple instead. Apple’s iOS and the multiple fragmented androids have captured this current and future consumer market, and there is nothing MS and the PC OEM’s can do about that – they are 4 years too late, and that train left the station long ago.

    but the enterprise market remains. it is ignoring W8, sticking with W7 anyway. and its hardware replacement cycles are getting 50+% longer too. but it will always need PC’s of some kind. so i expect the drop in PC’s sales to level off in about two years – at about 50% of their peak of two years ago.

    that is still a big market. MS can retrench to being an enterprise services company like IBM and do well with it. but inevitably there will be a bloodbath among the OEM’s – and several will not survive.

  • Phobos

    I don’t think wins 8 is to blame, most people pc’s from 08 and forward didn’t need to buy a new pc. Pc’s just last longer than they expected. This isn’t like when there was the move of one core to 2 or 4 and now the move to 6 to 8 cores seems quite pointless when most people all they do is surfing the net or checking Fb. As for gamers they are a very small minority even more so the people that uses the pc for 3d work and the like.

  • Glenn Scott

    I am concerned.
    We were hoping that Windows8 was just going to be a flash in the pan, and we could wait until they rolled out an OS that was more Widows7 like to push it out to our clients. If Microsoft keeps going this way, we might actually have to install this OS in the Enterprise, and no one wants that.
    The alternative is even more frightful. What if they DO keep on with this nonsense?
    I remember the windows xp rollout days. User training was a priority, but support was still a nightmare for weeks after the cutover.
    Bleh

  • VirtualMark

    Generic Windows 8 sucks comment.

  • Naipier

    “There’s just no avoiding the fact that PCs are being squeezed out by smartphones and tablets” that would be because most people already own a PC. Not everyone has a tablet or smart phone… so people are holding off on expensive computer purchases in favor of getting somthing they dont already have. After people have had their fill of overpriced smart phone plans and tablets that also either need a data plan or a coffee shop with wifi (or everone gets one), sales for PCs will raise a little and even out. Course, having a windows platform that if business friendly would help as well.