The New Normal (Premium)

OK, it was modest, but PC sales still grew in 2019. Here’s a look at what happened and at how things will change in the future.

First, it’s helpful to remember that while PC sales did, in fact, fall for seven years straight until 2019, the market has really been pretty flat since 2016. That was the last year in which we say a large, double-digit drop in year-over-year unit sales. And, perhaps more interesting, it was a year in which the industry sold 265 million units, a volume that is almost identical to this past year’s 264 million units. I would describe this period of time as “flat,” and it appears that the PC industry has at least temporarily plateaued after some bad years of freefall.

Here’s how those flat years break down:

2016: 265 million units

2017: 261 million units, -1.5 percent

2018: 259 million units, -.77 percent

2019: 264 million units, +1.9 percent

What we’re seeing in this time frame, I think, is the impact of the Windows 7 end-of-life (EOL). Windows 7 was the most popular version of Windows of all time, but it also wasn’t available on new PCs during this time frame. So when people or businesses retired their Windows 7 PCs, Windows 10 was their only choice. (Many businesses did take advantage of Microsoft’s volume licensing program to install Windows 7 on PCs that came with Windows 10, of course.) Remember that Windows 8.0 and 8.1 were made available between Windows 7 and Windows 10.

I’ve always been interested in the impact that Windows 7’s retirement might have on PC sales, and I think we’re seeing it in the 2019 figure: It was, as predicted, only a very small bump. That suggests that this tiny upswing in PC sales is temporary, though it is possible, maybe even likely, that we’ll see another small bump in 2020 as more Windows 7 PCs are retired and replaced. (Many will not be replaced.)

Further interesting is how this bump compares to the retirement of Windows XP, which happens in 2014. I had previously made the following image to depict that:

At first glance, it appears that all XP was able to do was temporarily minimize the PC sales freefall that had happened the previous year. That is, PC sales still fell that year, but much less than in the previous year. But I think XP’s impact was more dramatic than that, and was, in fact, more dramatic than what we’re seeing now with Windows 7. (This is doubly impressive because Windows XP’s life cycle was artificially extended by a few years, making it an even older platform than is Windows 7 today.)

Let me explain.

In 2013, the year before Windows XP was retired, PC sales fell 9.9 percent to 316.5 million units. In 2015, the year after Windows XP was retired, PC sales again fell dramatically, this time by 9.2 percent, to 288.7 million units. Had XP’s retirement not happened, one might have expected PC sales in 2014 to hit somewhere in the middle of those two figures---about 303 million units. But PC makers...

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