One of the widely discussed trends of the past few years has been the decline in PC sales and the rise in tablet sales. Tablets, more than smartphones, are credited with harming the US market — few people view a smartphone, even a highly capable device, as a complete desktop or laptop replacement.
Because so much of the discussion has been tablet- and US-centric, we’ve missed the impact that tablet and smartphone sales have had on the worldwide electronics market. Now that information has been combined and visualized for the first time, and while the data points aren’t ironclad (we’re drawing from a single source for this information), some of the trends are stark.
Some of these data points are so strong that they seem inaccurate — according to the chart, India’s PC usage has fallen to just 10% before rebounding slightly this year. In fact, we suspect there are anomalies in the data — if the Indian information were accurate, it would mean that PC usage had declined sharply (from 40% to just a little over 10%) while mobile use only increased from perhaps 13% to 22% over the same period. Since it’s unlikely thattotal internet use has declined so steeply, this suggests flaws in the data set.
Nonetheless, Gartner Research does back up the idea that the Indian PC market is in sharp decline: In Q1 2014, sales in the Indian market had fallen to 70% of their Q1 2013 level, while smartphone sales for the same period had more than doubled. Sales data isn’t the same as internet usage information, but the trends do point in the same direction — sharply rising sales of smartphones as conventional PCs drop.
Even in nations where PC usage hasn’t declined, it’s mostly stopped increasing. Mobile usage has grown dramatically almost everywhere, while the PC remains flat.
Upending conventional wisdom
Once upon a time, the conventional wisdom was that the developing world would industrialize and adopt PCs as it did so, either by buying into lower-end replacement PCs that had reached the end of their Western lifecycles or by purchasing new machines custom-built for their particular markets. Intel and AMD have both made various efforts to stoke this trend, and companies like Dell and HP expanded into emerging spaces. Now, that market trend is eroding on the back of smartphone sales, sometimes for reasons that have nothing to do with OS preferences or even convenience (at least, as Western buyers typically understand the world).
When the electrical grid is practically as constant as the sunrise, every home has wired connectivity of some sort, and landlines are something you opt out of rather than something you’d give your eyeteeth to acquire, we’ve got the luxury of predicating our product choices based on niceties of form factor and particular suitedness to a certain task. In nations where electrical power and data connections are both spotty, a device with substantial amounts of battery life that can recharge quickly and travels easily is vastly more useful — and that’s before you consider the dramatically increased performance and capability of smartphones to start with.
Why the sales trend matters
In the 1960s, the titans of the computing industry were companies like Burroughs, Control Data Corporation, GE, IBM, NCR, Honeywell, RCA, and Univac. Not all of these companies are gone today, but of the ones that still exist, only one of them continues to be a major player in the computing industry — and the IBM of 2014 is fundamentally different from the IBM of the 1960s, even if it remains a pioneering research firm.
These companies didn’t just own the hardware businesses that built computers, they fundamentally owned the idea of what a computer was. This is easiest to see by looking at the fiction of the period — the computers of Star Trek were essentially mainframes and this continued in Star Trek: The Next Generation and subsequent TV shows. For all its predictive capabilities, Star Trek never showed a handheld computing device that was as flexible or capable as the modern iPhone.
Star Trek, of course, is scarcely representative of all science fiction of the 1960s, but many other authors made fundamentally similar assumptions — vast computing resources would be centralized, with planetary-scale AIs or Galactic Libraries.
In the same way, Microsoft and Intel were fundamental to the idea of what a computer was for several decades. Both companies have lost the chance to define the mobile era — Intel took a shot at doing so with Mobile Internet Devices, or MIDs, but failed — but neither can afford to be relegated to completely also-ran status in their own industries. Hence, both continue to create mobile products and to push into these spaces.
