Smart­phones go down way of PCs

Financial Chronicle - - EDIT, OPED, THE WORKS -

THE smart­phone mar­ket is fol­low­ing the growth-chal­lenged path of per­sonal com­put­ers. That won’t please ex­ec­u­tives at Sam­sung Elec­tron­ics Co and Ap­ple Inc., but their pain might be great for con­sumers. Both Ap­ple and Sam­sung blamed weak smart­phone sales for re­cent dis­ap­point­ing rev­enue, at least in part. And world­wide, ship­ments of new smart­phones de­clined slightly for the sec­ond con­sec­u­tive year in 2018, ac­cord­ing to es­ti­mates from re­search firm IDC. The smart­phone mar­ket has en­tered a phase that the per­sonal-com­puter in­dus­try hit sev­eral years ago: De­vices are use­ful and good enough that peo­ple are buy­ing re­place­ments less of­ten, which pinches sales of new de­vices.

PC ship­ments peaked in 2011 at 364 mil­lion units, IDC fig­ures show. In the 12 months ended Septem­ber 30, ship­ments were about 260 mil­lion. About 1.4 bil­lion new smart­phones are shipped in the world each year. Ne­ces­sity (and des­per­a­tion) has been the mother of PC in­ven­tion. That fal­low stretch has been marked by some of in­dus­try’s clever­est ex­per­i­ments. Many com­pa­nies are mix­ing PCs with el­e­ments of tablets and smart­phones, in­clud­ing the abil­ity to

con­nect to the in­ter­net with cel­lu­lar sig­nals. There are more high-end, slim lap­tops for peo­ple who want stylish de­sign and light weight.

PC mak­ers have also been in­tro­duc­ing a flurry of souped-up PCs tai­lored to video game diehards with im­mer­sive graph­ics and mas­sive screens, in­clud­ing new de­signs un­veiled at the Con­sumer Elec­tron­ics Show this week.

Low-cost Chrome­books’ cheap lap­tops that do al­most ev­ery­thing through web browsers have swept through US schools and re­shaped tech­nol­ogy for class­rooms. The stodgy desk­top com­puter is be­ing re-imag­ined, too. The in­dus­try has evolved to make sure there re­ally is a PC for ev­ery need and ev­ery bud­get. It might be a blip, but the PC mar­ket is slightly grow­ing again af­ter all these de­vel­op­ments. IDC es­ti­mated that ship­ments of per­sonal com­put­ers world­wide inched up 0.7 per cent in the first nine months of 2018 com­pared with those in the same pe­riod a year ear­lier.

To be clear, few peo­ple ex­pect PCs to re­sume the rapid growth rates of the 2000s. The de­vices will never again be the cen­tral fix­ture of most peo­ple’s com­put­ing lives. But they still have their place. Just as smart­phones can­ni­balised some of the time and money peo­ple spent on PCs, now the same is hap­pen­ing to smart­phones. Carolina Mi­lanesi, an an­a­lyst at mar­ket re­search firm Creative Strate­gies, said peo­ple are de­vot­ing big­ger chunks of their bud­gets and wak­ing hours to newer gad­gets such as in­ter­net-con­nected home speak­ers and wear­able de­vices.

With this com­put­ing frag­men­ta­tion, the smart­phone mar­ket could use a dose of PC-like fresh think­ing. The age of the rect­an­gu­lar glass slab has gone on for a long time. The an­noy­ing lim­i­ta­tions that peo­ple complain about, in­clud­ing tooshort battery life and toofrag­ile screens, per­sist even as screens get big­ger and pro­ces­sors faster.

The end of easy growth in PCs forced Mi­crosoft, com­puter-chip mak­ers, PC hard­ware ven­dors and oth­ers to think harder about in­no­va­tion. Con­sumers got more and bet­ter choices. It might not be so bad, for con­sumers at least, if the smart­phone keeps go­ing the way of the PC.

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