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Wednesday, August 19, 2015

Portable Computing Market Outlook Remains Flat

The personal computing (PC) market has now undergone numerous attempts to stimulate a high-growth revival, without success. Back in March of 2014, I shared a market update entitled "Final Closure: End of the Wintel Era is Now Undeniable."

To some market observers, that perspective may seem overly pessimistic. And yet, here we are in August of 2015 and the outlook doesn't appear to have materially changed. Granted, there's some pent-up demand that exists in the PC marketplace, but the real solution is unlikely to be 'more of the same' vendor response.

​The recent launch of Microsoft Windows 10 during the second half of 2015 now has many PC OEM vendors hoping that the revamped operating system software will trigger a replacement opportunity for aging laptop and notebook computers.

According to the latest market study by ABI Research, total system shipments for portable computing are predicted to reach 165 million units for full-year 2015 -- which is essentially flat compared to 2014 levels.

That said, assuming that the no-cost upgrade promotion to Microsoft Windows 10 is successful, much of the existing installed base are likely to use their current computer hardware for at least a little while longer.

From a market research perspective, the portable Notebook PC category consists of four segments: netbooks, laptops, Chromebooks and ultrabooks.

"Segment growth is occurring in Chromebooks, much in part due to purchases by schools," said Jeff Orr, research director at ABI Research.

ABI believes that growth for 2015 is also in affordable ultra-portable PCs, where thin and light designs address more mobile use cases by reversing the display panel flat like a tablet, or having the screen separate entirely from the keyboard.

Other key findings from the latest study include:
  • Chromebook shipments are expected to increase 35 percent annually by the end of calendar year 2015 to 7 million units.
  • Sales led until now by North American educational buyers will yield to purchases in other geographic markets over the next 5 years, resulting in a 22 percent CAGR.
  • Ultra-portable PCs, including the so-called 2-in-1 convertible and detachable display models, experienced typical 1Q seasonality with a 24 percent drop in quarter-over-quarter shipments to 7.2 million units.
  • Apple MacBook Air continues to lead all ultra-portable PC OEMs, though Lenovo and Dell are closing the gap. The balance of the year is expected to remain soft for growth.
  • Laptops, the bulk of the Notebook PC category, are forecast to experience a unit volume decline of about 7 percent year-over-year.