Windows 8 takes blame for 'brutal' PC sales slide

Microsoft's new OS hurts industry as PC shipments contract 14%

By , Computerworld |  Hardware

But like his colleagues, Daoud agreed that Windows 8's lackluster acceptance played a part. "There's a disconnect between what the OS wants to do and what the end user sees," said Daoud, referring to the touch features of Windows 8 and the higher price of touch-ready PCs.

Daoud expected that the bad news for the PC business -- and Microsoft, which largely relies on sales of new systems to fuel Windows revenue -- won't be over soon, although he was optimistic that things would improve in the second half of the year.

"There is a correction the industry has to go through," said Daoud. "The addressable market going forward will certainly be smaller than this industry has been used to from 2002 until 2012. And that correction is likely to continue."

In some places, the downward turn is the new normal: The U.S. has posted smaller shipments year-over-year in nine of the last 10 quarters. Globally, the first quarter is the fourth consecutive to record fewer shipments than the year before.

Daoud rejected the idea that the industry is seeing the death rattle of the PC. "Do we need the PC? Definitely. They're going to be around for a while."

Gartner's numbers were a bit brighter in that it estimated worldwide PC shipments at 79.2 million for the quarter, compared to IDC's 76.3 million. And although Gartner did not call out Windows 8, it implicitly said that the new OS hasn't helped boost PC shipments.

"Similar to other mature markets, the U.S. will see the installed base of consumer PCs decrease going forward," said Gartner analyst Mikako Kitagawa in a statement. "This is because many of these systems will not be replaced with PCs; they will be displaced by other devices, or simply retired."

Last week, Gartner's Carolina Milanesi said declining PC sales and booming business for tablets and smartphones were putting the heat on Microsoft. The Redmond, Wash. developer, she said, must manage to grab consumers' attention with its tablets and phones in the next 20 months, or see its influence and relevancy wane.

The quarter's PC shipment estimates add fuel to Milanesi's argument, as Gartner's previous bet was that the PC market would contract by 3.5% in 2013, less than a third as much as the first-quarter drop.

Microsoft will hold its quarterly earnings call with Wall Street analysts next week, on April 18, starting at 2:30 p.m. PT, when it will reveal revenue figures from its Windows division.


Originally published on Computerworld |  Click here to read the original story.
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