HP and Dell are starting to feel the heat after both companies posted results that showed the desktop PC is slowly dying, as people continue to move away from traditional computing options to more mobile-centric devices like smartphones and tablets.
While HP actually reported revenues that improved on the same quarter a year ago (by 3 per cent if you're counting) it’s had to issue a warning that the rest of the year isn’t looking so great.
Dell too has bucked industry trends announcing better than expected results, however, like HP, both companies' results relied on enterprise rather than consumer spending.
For HP it's a more worrying story, for aside from the kerfuffle over having to choose a new CEO in October, the last CEO getting embroiled in a sexual harassment case, and buying Palm to boost its smartphone and tablet opportunities; consumers aren’t, it seems, buying into what the company has to offer as much as they have previously.
“The steepness of our Q2 decline (in consumer PC sales) is greater than we anticipated” Leo Apotheker, the current HP CEO said in an earnings report call on Tuesday, suggesting that the days of a beige computer in your spare room are well and truly over.
Apotheker, who came from the business to business market, rather than consumerland, says that consumer PC sales fell 23 per cent in total in the quarter for HP.
That’s a big drop and likely to be one of the main factors for concern moving forward, as people look for sexier, easier to use tablets over traditional boring desktop PCs.
While HP offers its high value design and music focused HP Beats and HP Envy ranges, it’s yet to launch its tablet offering, the HP TouchPad.
Expected in June, many are sceptical as to whether it’s too little too late, and whether the market will be able to take yet another operating system beyond Apple’s iOS, Google’s Android, and BlackBerry’s QNX powered PlayBook.
The HP Veer, launched on AT&T in the US this week, is the first of the three new devices announced by HP earlier this year following the Palm buyout, though it hasn’t been well received in the US by reviewers.
Dell in the meantime has started to shift away from desktop PCs. It's already got two Android powered tablets on the market, the Dell Streak 5 and the Dell Streak 7, with the promise of more before the year's out. Likewise it's been a lot more aggressive in updating its laptop line to keep up with consumer demands and changing attitudes.
It looks like it’s going to be a tough year ahead for the PC makers.