What the PC sales slump really means -- and why it will get worse

Ultrabooks have fizzled, and so will Windows 8 computers when they ship this fall

There's lot of both hand-wringing and hope going on today in the world of PCs. PC sales are down, despite all those sexy Ultrabooks that were supposed to reverse the trend and let PCs enjoy the same growth as Macs have had despite the economic woes. That's the hand-wringing. The hope is that Windows 8 will solve the problem of people not buying PCs like they used to. For example, Sanjay Bathia, CEO of Windows app dev provider Izenda, says "there seems to be a rejuvenated hope for Microsoft" due to Windows 8, which he suggests could lead to an "Apple takedown."

I'm not convinced Windows 8 will deliver the surge in sales, given how awkward it is to use.

Ultrabooks haven't reversed PC sales' slide

It's clear that PC sales are down. What's less clear is whether this is just a Windows phenomenon or an industrywide phenomenon. The two leading purveyors of estimated computer sales data had very different guesstimates about PC sales in the second quarter. Gartner says worldwide PC sales were down 0.1 percent from Q2 2011 to Q2 2012, but Mac sales in the United States were up by 4.3 percent. IDC agrees that worldwide PC sales were down 0.1 percent, but it also says that Mac sales in the U.S. were down 1.1 percent. Lenovo and Asus are big winners and Dell and Hewlett-Packard hit the skids; the numbers vary depending on who you believe.

We won't get definitive word about Apple sales until the company's financial results conference call on July 24. But there's a whole lot of "analyzing" going on right now that just doesn't make sense.

Let's start with the obvious: Ultrabooks went nowhere. Mikako Kitagawa, a principal analyst at Gartner, said, "Despite the high expectations for the thin and light notebook segment, Ultrabooks' shipment volume was small and had little impact on overall shipment growth." That shouldn't surprise anybody: Ultrabooks are and always have been a lot of hot air. We won't have definitive numbers until July 24, but it wouldn't surprise me a bit if, in Q2 2012, the MacBook Air outsold all branded Ultrabooks (remember, that's an Intel trademark) by 10 to 1.

Some analysts believe that Ultrabooks are poised for greatness this summer, now that the Intel "Ivy Bridge" chips are out. I believe that's hogwash. Why? "Ivy Bridge" is dandy, but it isn't going to drive tens of millions of people to buy new computers.

Why the PC sales drop: Waiting for Windows 8 or buying iPads instead?
Consumers (and corporate buyers) are smarter than the analysts seem to think. Why on earth would someone buy an x64 Ultrabook right now, knowing that touch-friendly, Windows 8-oriented models are just around the bend? With Windows 8 due in October, it doesn't make any sense to lock yourself into a touch-disabled computer, unless you're absolutely certain that you'll never want to run Windows 8. And if you envision a fingerless future that's Win 7-only, why not wait for the inevitable Ultrafire sale in September?

That customer reaction to wait for Windows 8 in fact is IDC's explanation for the drop in PC sales, though it attributes the pause to buyers being confused rather than intentional in their decision to wait: "The announcement of a Windows 8 launch date, as well as broader communication of new features in the OS, are key steps that would help to address uncertainty about new product availability and help consumers and channels plan their purchases." Umm, no -- customers are not confused. They know what's going on and are simply being rational in waiting to see if the promise is matched by the delivery. After all, Windows 8's launch date has been pegged around October for many months now. As far as a description of new features, Microsoft's Building Windows 8 blog holds about 10,000 pages covering every imaginable detail.

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