IBM: PCs Are Yesterday’s Technology. China: Sure, But Give Us Millions More.

7 9 Loading

“My primary computer now is a tablet.”

— Mark Dean CTO of IBM Middle East and Africa, 2011

PC trash pileHere’s a classy move for you: sell your company to someone else, watch them reach new levels of success, then announce that your former product (and all others like it) is obsolete. Oh, IBM, you really are quite the dashing gentleman. In a recent blog post, IBM CTO Mark Dean opined that personal computers are “going the way of the vacuum tube, typewriter, vinyl records, CRT and incandescent light bulbs.” In other words, PCs are dead.

Someone forgot to tell China.

Beijing-based Lenovo bought IBM’s PC business back in 2005 and has been selling them like gangbusters since then. In fact, all of China is going PC crazy. As of the second quarter of 2011, China surpassed the US as the biggest market for personal computers (22% market share vs. 21%). The Wall Street Journal has more on China’s silicon hunger in the video below. Is China gobbling up sales of a product that’s on its way out? Are we in the post-PC era? Who’s got it right IBM or Lenovo? Maybe, yes, and both. The world of computing is surely evolving, but don’t get concerned about which slice of technological progress is being replaced and which isn’t. Keep your eye on the forces behind those changes, that’s where the real action is.

International Data Corp recently published their evaluation of the personal computer industry and found that China had taken the largest market share for Q2 2011 with 18.5 million units valued at $11.9 billion. The United States came in second with $11.7 billion. Now, IDC still predicts the US to come ahead for the year due to seasonal variations in sales, but 2012 will undoubtedly be China’s year to rule the PC with projections of beating the US by millions of units. The Wall Street Journal summarizes this up nicely in the following video and gives their own conjecture as to why this is so (lower Chinese saturation, and US market interest in tablets/mobile):

You’ll notice that the reasons WSJ gives for China’s rise in PC consumption jive on a fundamental level with what Dean pointed out at IBM. We’re in a post-PC era. And by “we”, I mean the US. American interest in personal computers is now augmented by interest in tablets, mobile devices, and other form factors. That’s not stopping us from buying computers, it’s just changing what we’re asking computers to do, and buying our hardware accordingly. As Dean puts it:

“PCs are being replaced at the center of computing not by another type of device—though there’s plenty of excitement about smart phones and tablets—but by new ideas about the role that computing can play in progress. These days, it’s becoming clear that innovation flourishes best not on devices but in the social spaces between them, where people and ideas meet and interact. It is there that computing can have the most powerful impact on economy, society and people’s lives.”

What Dean says rings true for me. The most exciting developments in computing are the person to person applications. Most obviously I mean social networks, internet services, and the transformation file sharing has on intellectual property. On a deeper level though I’m talking about how computer-enabled applications fuel crowd-powered changes. Mobile phones are becoming one of the default platforms in Africa, with cheap smart phones giving hundreds of thousands of users access to the Android app market. On that platform we see innovators looking to effect health, education, and entrepreneurial endeavors. Similar scenarios are being played out all across the world and at every socio-economic level. Powered by (relatively) cheap digital technology, humanity is thinking up millions of new ideas for prosperity and profit. Computing in the 21st century is all about enabling people to enact change.

But that doesn’t mean the PC is dead. It just means that the ecology of computing is going to have more than one level. China is now (or soon will be) the world’s largest market for PCs. Guess what, it’s also the fastest growing market for iPhones. That just makes sense – they have low saturation for many advanced technologies and they have a national interest in launching themselves into the forefront over every major industry. They’re run by a group of scientists, for goodness sakes. China is going to gobble up computer power in all its incarnations, from desktops to server farms to smart phones.

So is every other developing nation.

We are in the post-PC era, but that era isn’t about ditching one hunk of plastic wrapped silicon for the newest gadget, it’s about what happens when we don’t have personal computing but global computing. When most of us have access to a computer on a regular basis, the world will do different things with computers. We aren’t there yet, but we’re getting closer. IBM is hinting at what that world may look like: companies pushing the boundaries of technology to find the next level of application space. IBM invests $6 billion per year in R&D, with projects like Watson, which could evolve into a virtual doctor, or any number of other possibilities. Why develop a program that can talk like a human, and make decisions like a medical professional? Because post-PC computing will eventually allow anyone with a mobile phone access to it through the cloud. That’s just one example. There will be millions more.

IBM declaring the PC dead and China buying record numbers of them are really the same story: “Computers are becoming democratized so it’s time to see what they can really do.” Just as some companies, like Lenovo, are having success bringing one tier of computing (PC) to new markets, other companies, like IBM, will need to expand what all forms of computing can do. And this won’t be divided along West-East lines either. China’s going to be right up there at the highest levels of computing looking to challenge IBM and all the other established names. The world is getting smaller and everyone willing to look a few years ahead will be scrambling to stay at the top of the technology pile. Ultimately I think that means humanity will have wider, cheaper access to all manner of devices running next generation applications that can have profound impacts on the fundamental challenges we face.

The era of global computing is near. The change that it brings is going to be unbelievable.

[image credit: Manuel Flores V via Flickr]

[sources: International Data Corporation, A Smarter Planet Blog (IBM)]

Discussion — 9 Responses

  • Ver Greeneyes September 1, 2011 on 7:57 am

    It’s almost impossible to do anything truly productive on a tablet (or a smart phone for that matter) because touch screen UIs, while hip and fancy, are anything but efficient. PCs and laptops aren’t going anywhere until we get a replacement for the good old keyboard (and arguably the mouse). And that isn’t going to be voice control, because 1) voice control has been around for ages but has never been truly seamless, so has major public perception issues 2) no one wants to have to speak to their computing device in a public workplace. The only replacement for typing that might eventually catch on is brain wave control, assuming such devices get fine-grained and intuitive enough to process entire sentences from thoughts. If that’s still too far off, we may eventually get bionic enhancements to allow us to type faster (assuming we also get enhancements to think faster) a la Ghost in the Shell. But beyond that, no, PCs are not going anywhere. The market is expanding, and PCs may not be the most convenient devices for things like entertainment, but they are far from redundant.

  • chopinzman September 1, 2011 on 11:26 am

    PC’s will stick around for awhile, I think that there are so damn many You’ll still see them everywhere. But I think that they’ll stop producing them within a decade. As soon as brainwave controlled devices are coming out all you will need is a screen. Even the screen will disappear eventually.

    I suppose you could have a malleable/bendable I Pad, with a touchscreen that felt like keyboard, but I don’t know.

    Personally I like a big a$$ screen, laptops dont quite satisfy.

  • Carl Menger September 1, 2011 on 12:43 pm

    Play on semantics.
    Comparing PC’s to Tablets isn’t quite accurate.
    PC’s have become increasingly powerful, to the point where they’re mini-super computers.
    I do work from home, no way is a tablet going to be able to do what I want to do, *right now*. Now, a tablet in 5 years might, but that is not going to help me in the present.
    Poorer people cannot yet afford a tablet.

    Incandescent bulbs are going away because Congress banned them(no more after 2014), not because people chose not to buy them. No value judgment, just facts.
    Vinyl has actually surged its market share in the last 5-7 years
    http://i.imgur.com/hC3eV.gif
    Vaccuum tubes are still desired in the high-end music recording field, the harmonic distortion they provide hasn’t *yet* been eclipsed by algorithms.
    Type-writer and CRT? I do not know.
    Mark Dean is just trying to sell stuff, so he will be “sensational.”
    There is a rising middle-class in China that’s wants PC’s.

  • woegjiub September 1, 2011 on 6:34 pm

    Pure sensationalism.
    The PC is necessary, even if it is a reduced form such as a netbook.
    To get any real work done, one needs a fully-fledged desktop program, such as an office suite, photo manipulation tools, mesh editing, video editing, music production or CAD.

    Tablets are fine for playing with, consuming media and as an aide for things like slideshows, and to have some handy tools with one, but they are useless for even typing up a report.

    The PC is going nowhere, as everyone replaces theirs every 2-5 years.

  • Joe Nickence September 1, 2011 on 8:15 pm

    A better way to phrase this would probably be “Traditional computing will be delegated to niche tasks”. Two words I heard overall in the comments are screens and keyboards. With cloud computing being implemented with a wireless connection, a document can be worked on using a tablet device, beaming the output to any screen/television not currently in use by another person. Your phone becomes your mouse. Pundits and forecasters predicted the death of paper documents years ago, yet we still use printers. In 15 years time, your traditional computer will be housed in your favorite piece of furniture. Open a drawer, retrieve your trusty wireless keyboard and mouse, and your output shows up on your big screen TV using pcture-in-picture. Once the report is done, you put the tools away, and bring out the tablet again. As for the traditional white box and blocky monitor, yeah, those are soon to be history.

  • xomox September 2, 2011 on 4:49 pm

    another PERFECT example of “Planned Obsolescence”! China (Lenovo) & “the west” (IBM) BOTH doing their parts to increase and exponentially increase waste generation and dumb more trash on/into the Earth… bravo frack-tards!

  • Joe Thorpe September 4, 2011 on 1:42 am

    How can some of you come to this site, read what we read and still think pc’s will be around in 15 years?

    That is 2026, by 2025 we should have something way better then the pc, it is the whole exponential curve thing.

    If we do not have some type of heads up display by then something is wrong.

  • wonkavision September 9, 2011 on 10:29 am

    More likely, the PC will again become the exclusive domain of geeks, and geeks will like it that way. Ordinary consumers just can’t handle a PC; they need simple point-and-TOUCH devices with big candy-colored icons, and big business is catering to them.