The spectacular rise of Tablets led by Apple’s iPad has once again revolutionized the Technology markets just like the iconic iPhone has completely changed the paradigm of the mobile phone market. While we have already chronicled the demise of the established mobile companies like Nokia (read below), here we show you step by step how the PC market and its leaders Intel, Microsoft and HP are getting killed by Apple’s game changing iPad and its Android clones.
How Apple is killing PC Market & its Leaders – Intel, Microsoft, HP
a) PC Sales Decline by Highest Since 2001
IDC and Gartner Inc. reported that worldwide PC shipments in the third quarter contracted by the highest amount since at least 2001 compared to the same time a year ago. Though HP remained the biggest PC maker, China’s Lenovo had increased its marketshare lead to become No.2 at the expense of Dell.
b) Biggest PC Maker Hewlett Packard facing Huge Challenges
Note HP is facing a huge challenge as its stock price continues to decline under a new top management. HP saw its stock price plunge nearly 13 percent on 3rd Oct after CEO Meg Whitman failed to wow Wall Street with her strategy to revive the company. Many investors have cooled on HP as its sales have flattened, its profit has slumped and its debt has ballooned to $30.6 billion, prompting it recently to announce it is eliminating 29,000 jobs over the next couple of years.
There are two giants in the computer processor industry. One is Intel, which builds most of the processors in today’s PCs and servers. The other is ARM Holdings, in Cambridge England, which, thanks to its vast ecosystem of partners has established near-complete dominance of the market for the core logic inside smartphones and tablets.
But the demand for energy-efficient chips is reshaping the industry. As the PC market flattens, Intel aims to capture a sizable chunk of the rapidly growing mobile market, which rose to nearly half a billion smartphones in 2011. And chip designers in ARM’s camp are eyeing a US $50 billion server market, fueled by the rise of social networking and cloud computing.
d) Microsoft Windows 8 seems a Dud
Only 0.33 percent — or 33 out of every 10,000 PCs — currently run a Preview version or RTM trial of Windows 8, Computerworld reports, citing statistics from metrics firm Net Applications. At the same point to the release of Windows 7, 1.64 percent of all Windows PCs were running the upcoming operating system. That’s a full five times more than Windows 8 adoptees — and the gap between early Windows 7 adoption and early Windows 8 adoption is actually increasing as October 26th draws closer. Simple customer satisfaction may be part of the reason for consumer hesitation; Windows 7 was the follow up to the widely panned Windows Vista. Many people consider Windows 7 to be the best version of Windows ever released, while early reaction to Windows 8?s tiled, touch-focused interface has been decidedly mixed, with one expert going so far as to call the Modern/Desktop switching “a cognitive burden”.
e) Dell Slump is even longer than that of HP
Computer maker Dell has reported 18 per cent drop in net profit to USD 732 million in the May-July 2012, which saw 30 per cent dip in India revenues – sharpest fall in the Asia Pacific region. Once the world’s top PC maker, Dell is now struggling to defend its market share against rivals like Acer and Lenovo and tablets like Apple’s iPad.
The mobile phone market has changed radically in the last few years with the advent of Apple’s iPhone. The introduction of the Apple smartphone was a major game change in the Technology Industry with the whole existing ecosystem undergoing a fundamental realignment. The once dominant Nokia with a 40% global marketshare of the mobile phone market has been continuously declining as can be seen in its share price. Despite numerous restructurings, management and strategy changes, nothing seems to work against the onslaught of Apple and Android. HTC, the first Taiwanese company to manage to break through the OEM mold of its fellow companies, is facing the music as well. HTC which had managed to quickly gain marketshare in the smartphone market is following behind Samsung and Apple. The company has been reducing its revenue and profit targets quite frequently as it fails to compete against the emerging duopoly of Samsung and Apple. Note others like Research in Motion are now facing survival questions as well while the iconic Motorola has been gobbled up by Google. HTC is not only facing problems in products but is also facing a patent war unleashed by Apple and Nokia. Note one of the reasons for Google to buy Motorola was to add to its arsenal of mobile patents as Apple and Nokia started court cases against Android vendors in most developed countries. Though Samsung is being able to put up a good fight, HTC is not managing as well because of its limited size.
Though Apple has changed the Technology Markets we think Apple is a Short. Read GWI reasons for going short Apple.Google+