PC Sales Have Now Fallen for Six Years (Premium)

The PC market has now experienced six straight years of decline, with PC sales hitting 261 million units in calendar year 2017, down 1.5 percent from the 265 million that were sold in 2016.

The good news? That's a tiny decline, and the decline is slowing.

But the bad news is just as obvious. We've been waiting for plummeting PC sales to plateau for years. And while we've gotten close a few times---in the year-ago quarter, for example, PC sales were almost flat, year-over-year---the broader trend has been consistent. PC sales keep falling.

The height of the PC market, from a unit sales perspective, came in 2011, when PC makers sold 365 million units. So PC sales have fallen 28.5 percent in the intervening six years, or by almost one-third. That is an incredible decline.

Since my math is based, as always, on combining data from both Gartner and IDC, it may be interesting to see what they have to say about the past year's results.

"The market will have to go through the shrinking phase caused by fewer PC users," Gartner noted. "The PC will become a more specialized, purpose-driven device. PC buyers will look for quality and functionality rather than looking for the lowest price, which will increase PC average selling prices (ASPs) and improve profitability in the long run."

I'm not sure about that last bit, though it's fair to say that premium PCs of all kinds, including gaming PCs, are a profitable and growing sub-market that all PC makers are pursuing. But the first comment about PCs being specialized, purpose-driven devices is absolutely correct. Today, we do many general-purpose tasks on other, more mobile devices, especially smartphones. And PCs are reserved for productivity tasks that require a keyboard, mouse, and larger screen, plus more mature and complex productivity tools.

IDC, meanwhile, reported that the "traditional PC market" is still "weak," but the slowing decline was helped by commercial PC upgrades, and by a renewed focus on slim, convertible portable PCs and gaming systems.

"The overall PC market remains a challenging one," IDC said. "The growing popularity of other mobile form factors continued to have a dampening effect."

Both Gartner and IDC agree that HP is still the world's biggest maker of PCs, having sold about 57 million units in 2017, good for about 22 percent market share. Lenovo was number two, with 54.8 million units sold, and Dell came in, again, at number three, with 40.9 million sold.

Other PC makers sold considerably fewer units: Apple arrived at number four, with 19.5 million units sold, good for just 7.5 percent market share for calendar year 2017. And ASUS (17.55 percent) and Acer (17.3 percent) were basically tied for fifth place.

One of the interesting side-effects of the PC market decline, of course, is that we're seeing fewer and fewer companies in this market, and I expect that trend to continue in 2018. For 2017, for example, the top three companies---HP, Lenovo, ...