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A Wall Street Journal article published last week declared that the curtain had officially come “down with a bang” on the global market for personal computers. With the recent announcement by industry leader Hewlett-Packard that it may be abandoning its PC business, many analysts have come to this same conclusion. Ever since IBM abandoned its PC business in 2005, many have been predicting that tablets and other technological devices will render computers obsolete. Is the PC industry really dead, or does the modern world economy offer new opportunities for companies to profit?
TIME Business offered an alternative approach to this question, arguing instead that the PC industry is changing as individuals and corporations alike are adopting multiple technological devices into their regular repertoire. With a closer look at the overall supply chain, PC companies are finding countless opportunities to manufacture and distribute computers more efficiently to customers. New capabilities may still be developed to enable PCs to solve problems that they have never tackled before.
China recently surpassed the United States as the largest PC market in the world, highlighting the trend of rapid PC growth in emerging markets. While computers may be viewed as a commodity in the United States, there are still untapped avenues for growth elsewhere around the world.
For an industry with millions of employees and billions of users worldwide, a total collapse will not happen overnight. Rather than abandoning the PC business altogether, some technology giants are expanding into China and other world markets. Dell has invested heavily in China, although it still trails Lenovo (a Chinese company) in Asian markets. According to the Wall Street Journal, Dell expects to spend over $100 billion in China over the next ten years with the opening of a new operations center and heavy investments in R&D. Michael Dell has publicly declared that the company has no plans to eliminate its PC business in the coming years.
Other global PC markets are also rapidly expanding. Russia has become one of the most important growth areas for Lenovo and other competitors. Forward-looking businesses are investing in such markets now in hopes of capitalizing on anticipated industry development in the coming years. By learning the unique market characteristics of BRIC countries and establishing strong brands before the tide of technological growth arrives, PC-makers will reap the benefits for years to come.
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