PC makers to start taking the Tablets

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The punters are not buying desktop PCs; they are beginning to lose interest in buying notebooks; corporates are still flocking to Dell but staying away in droves from PC resellers. What is a poor PC maker to do?

Answer, according to In-Stat/MDR, is to extend into new markets with different format mobile devices - tablet PCs, Internet terminals(?), and Microsoft Mira-powered displays and the like.

Tablet PCs, the Next Big Thing for ooh a decade and then some, are characterised by In-Stat as "a promising technology that is coming onto the market at a bad time". Corporates are the key target buyers and they and they won't unlock their purses in a hurry. Also people will have to get used to pen input. Upshot, take up will be slow at first, ramping up to rapid growth come 2005-2006.

Mira displays, on the other hand are "an interesting concept that combines the PC with the Web Tablet, allowing consumers to access their PCs via wireless displays." But they are going to be pretty rudimentary at first. Wait until the next-gen devices out in early 2004 and capable of handling video streaming and other multimedia apps. These will "convince consumers to take a serious look at this product".

We're unsure why Internet terminals are bandied with tablets and Miras, - not particularly mobile and not particularly new. The market for consumer Internet terminals, once seen as promising, has failed to develop, as In-Stat points out.

"Internet Terminals reached a low point in 2002, with most of the initial products introduced by the likes of Compaq, Sony, and 3Com, already off the market."

The analyst firm forecasts modest growth for this class of device through 2006 by targeting vertical markets and niche business apps.

OK, so will these new devices save the downtrodden PC maker? Well, different formats worked for Apple, the only major PC maker apart from Dell to make a profit lately. It's done this on the back of good-looking cases and monitors, but then it too has stumbled in recent weeks, overestimating demand and piling up inventory.

As IDC's Roger Kay told Bloomberg: "The problem with being a Milanese fashion show is you need to have a hit every season. It's a risky strategy."

And Apple is good: if it's a risky strategy for Apple think how much harder it will be for the design donkeys who run most PC system builders.

Maybe the different-shaped kit will carry higher margins - at first - and maybe there will be less competition -at first (until the Taiwanese factories get into full swing).

But If your core PC business is in trouble, how will it be saved in the long-term by making, or more likely rebadging from Taiwanese OEMs, different-shaped kit. Which looks the same as all the other different-shaped kit peddled by your rivals. ®


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