San Francisco, July 24
Last week’s earnings from the giants of technology had one thing in common: they underscored yet again how consumers are increasingly shunning desktop PCs and going mobile.
Intel, which had argued that pessimistic expectations about the market were out of whack, reduced its 2011 PC forecast. Microsoft Windows sales, that reliable indicator of PC market strength, fell short of expectations for the third straight quarter.
Apple Inc, which single-handedly showed with its iPad that many consumers are more than happy with an unladen, light and mobile computer, obliterated all estimates by selling 9 million tablets.
“The desktop, at least for consumers, probably doesn’t have a great future. The iPad and similar tablets can deliver a lot of the functionality of a laptop,” said Tim Ghriskey of Solaris Asset Management.
Worldwide shipments of smartphones are already overtaking PCs, and by 2015, more than 300 million tablets will ship — not far behind 479 million PCs expected to be made.
To be sure, there’’s time left for PCs. Adoption and sale continue to grow rapidly in emerging markets and among corporate users.
But even there, increasingly powerful smartphones are entrenched and tablets are creeping in.
Shares of Apple reached a record this week and are up 21 per cent in 2011. Intel has gained 10 per cent, a bit better than the broader market, but Microsoft is down about 3 per cent. PC sales edged up just 2.3 per cent in the second quarter, according to tech research firm Gartner, well below earlier projections.
Intel and AMD are increasing their focus on processors suited for smaller devices. They’re pushing manufacturers to use their chips to build laptops that are in many ways touchscreen tablets.
The market for processors used in smartphones and tablets is about $6.7 bn this year, MKM Partners estimates.
Intel is speeding up plans to use its most cutting-edge technology to manufacture chips aimed a mobile devices, and Chief Executive Officer Paul Otellini said this week the company would be “hyper-competitive” in getting its silicon into tablets running Microsoft’s upcoming version of Windows.— Reuters
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