What was interesting to me was that they were unable to give a strong rationale for such a dramatic uptick in shipments (the highest since 2005) and told me that they were not able to get a clear answer from other vendors either. Hence, while analysts such as IDC talk about portability, a strong back to school, and growth in emerging markets as key factors, they don’t try to dig deeper and examine the fundamental dynamics that are driving the acceleration of growth in the market. In other words they are simply describing what is happening, not why it is happening.
This is understandable though a little disappointing, because I think it is important to try and understand why, for example, small businesses in EMEA are increasing their PC spending or why, as another example, emerging market businesses and consumers feel they need to invest a proportion of their growing income in PCs rather than other products or services.
At least part of the answer, I believe, can be ascribed to what I can only describe as the digitization network effect: as the Internet becomes more pervasive throughout the world, more and more individuals and small companies are feeling that they have to get connected to it in order not to be left out of things and to participate in the global economy.
Now, it could be argued that in the case of emerging markets, the mobile phone is a more appropriate tool for getting connected than the PC, and to some extent this is true. But at the same time, this ignores a second key trend that is beginning to emerge (and could in my opinion be a key driver behind the upsurge in PC sales): one that I will for the purposes of this article call the “digital complexity effect” or perhaps the “digital domain effect”.
So what exactly do mean by this and how does it impact PC sales? I haven’t formulated a clear answer to these questions yet, even though I’ve been thinking about this subject for a few months now, but here is a very rough barebones analysis:
Personal Data Management: With the explosive growth of information available on the Internet, not to mention the relentless 24/7 news flow, we are facing increasing challenges in managing how we access, process, and store it and this will task will only get even more complex as the transition from text-based information to graphical- and video-based content speeds up. For all the increased capabilities of mobile phones, they simply don’t have the ability to help you manage all this; PCs on the other hand do give you this capability either locally or through full-featured access to Internet applications.
Personal Digital Domains: Not so long ago our digital presence was limited to email, Instant Messaging, and maybe a blog or website, but thanks to the emergence of video, imaging, social networking, and virtual world technologies, we are now in the early stages of extending this presence into personal digital domains that we are using to tell our life stories in glorious multimedia through blogs, FaceBook, and YouTube. Again, while mobile phones may allow us to capture certain episodes of our lives (mainly in low resolution or short bursts of text), only PCs give us the ability to tell our whole life story.
From Information to Entertainment; from Products to Stories: If you take any class of consumer products and look at it closely, you will see that the key points of differentiation have moved from features, specifications, and quality to design, branding and the uniqueness of their story. People don’t go to Starbucks just to buy coffee but for the whole experience. By the same token, to capture people’s attention you don’t just have to inform but also entertain them. In other words, for companies (and individuals) to survive and prosper in the global economy, they will need to generate ever more compelling content around their offerings. Again, and I don’t want to belabor the point, only a PC can help us do this.
This is the new 500MHz VIA Eden ULV (ultra low voltage) processor that we announced earlier today. With an idle power of only 0.1 watt and a maximum power of 1 watt, it is quite simply the most power-efficient x86 processor on the market today – and ideal for a wide range of embedded and ultramobile device applications.
In fact, the processor is proving so popular that it has already been adopted by no less than 30 of our customers, many of who are showing off their devices at the Embedded System Conference that kicked off in Taipei today.