Windows 10 won't help. The PC biz is doomed, DOOMED, I TELL YOU
Industry folk react calmly to Microsoft's hopeful future sales targets
What a difference a year makes. At this point in 2014, PC vendors were riding high on Windows XP support doom, but fast forward to the here-and-now and the pending launch of a certain OS isn’t causing the same waves.
Anyone mildly connected to the IT industry understands chip and operating system updates don’t have the same pull for consumers and businesses as they used to – these are no longer viewed as "big events".
But with desktop demand returning to pre-XP support expiration levels, and notebooks – specifically low-cost machines – growing at low single digits, some may be praying for a Windows 10-led revival this summer.
"Don’t hold your breath" seems to be the message from analysts at both Gartner and FGR & Co, however.
Ranjit Atwal, research director at Gartner, reckons the launch of the OS won’t do the market any harm: "After the disaster of Windows 8, Windows 10 should be accepted with more open arms”.
But though the product set – including touch, and thinner and lighter devices – has improved, “Windows 10 won’t provide much uplift in the market," according to Atwal: "...it may just help to keep things ticking along”.
“This will not be a revolutionary change, there has to be a revolutionary change in the OS and the form factor to drive demand,” Atwal added.
Microsoft forecast that one billion devices would be running Windows 10 in two years – but it didn’t break down the numbers for each type of hardware, and could be accused of marketing bluster.
Gartner predicts more than 422m devices (desktops, notebooks, tabs and phones) running Windows will ship this year. At that rate, Microsoft would need to double sales between 2015 and 2016, and do it again in 2017 to give it a chance.
The figures for Microsoft's other devices don't even come close to the magical number it is proposing. It sold 34.9 million phones in 2014 and Windows tab sales aren't worth mentioning, although they are growing.
Clearly the size of the pie for iOS and Android developers may not be as big as Redmond wants them to believe.
FBR & Co analyst Christopher Rolland spent some time with Intel and gave his prognosis that high inventory levels from Q4 and Q1 could impact distributors’ and retailers’ stocking decisions for Windows 10.
“We believe many investors did not expect additional PC inventory drain into the Win10 release... while Intel expects inventory replenishment in 2H15 around the Win10 release, it was careful to temper expectations for a surged uptick in demand,” he explained.
Globally, PC shipments are predicted to decline 2.4 per cent this year to 306 million units. A senior source at a major PC vendor told us the market was down so far this year: “There’s no evidence that things will pick up in a material way. I’d like to hope people are postponing purchases for Windows 10 but we are not forecasting a massive rise in demand.”
Corporate enterprises are either migrating to or are already using Windows 7, and a reseller that makes a living by selling product to such organisations questioned the ROI of upgrading to Windows 10.
“Corporates are asking what they’ll get out of it other than a basic update,” he said.
Still, at least Windows 10 has a start button again. ®
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