PCs Aren't Going Anywhere

In a recent article on the decline of the PC industry, analysts suggest that for the time being, the PC market is not doing as badly as it was predicted to do in 2013. I argue that while there is a significant decline in PC sales, it is only in the consumer market. Sales will remain strong in the business market.

It's really interesting to think that in 2013, phones and PCs can be thought of as substitute goods. Ten years ago, PCs were considered the future and there was no way that a phone could be a viable substitute. Advances in technology have allowed phones and tablets to become 'smart' enough to do most everything that a PC can do.

While its true that the PC market is shrinking, PCs will continue to remain relevant into the future for enterprise purposes. Right now, phones and tablets are selling a lot quicker than PCs are selling. This is happening because the market for private consumers is larger than the business market. Phones and tablets are relatively new, first-time purchases for many consumers and most would rather spend money on a tablet or phone because it meets their needs for internet browsing, gaming, social media, etc. For consumers, phones/tablets are substitutes for PCs. For businesses, phones/tablets are not substitutes for PCs. PCs are simply better suited for things like typing, working with spreadsheets, large amounts of data, and other tasks that are normally done during a workday. Because of this, overall sales of PCs will continue to drop but PC sales in the enterprise market will remain strong.

1 comment:

Dave Tufte said...

Su Jung Poe: 100/100

Where is the ManEc in this post? This is about experimenting with the ideas in a forum where you're not scored on them ... and I don't see much ManEc at all.

Yes, PCs, phones, and tablets are probably substitutes for households. That's just (plausible) speculation though: the real test of that is when you go and measure the cross-price elasticities ... and there aren't any of those.

Yes, they may not be substitutes for enterprises. There's a name for that: complements. Again, this is an empirical measurement.

I don't expect you to go out and actually make those measurements, but if you're not going to do something, your fallback position should be deeper than speculation.