As more people around the globe discover that they don't need a personal computer (PC) to participate in the Global Networked Economy, the market for smartphones and phablets has satisfied the demand for internet access and web browsing. This is now the pervasive trend worldwide.
Besides, the ongoing adoption of Software-as-a-Service (SaaS) apps meant that mainstream users learned what has become common knowledge -- just about anything you need to accomplish can be done in the cloud. The impact of this disruptive trend on traditional PC manufacturers has been devastating.
"The global PC market had a bad start to 2016 and it is difficult to see any bright spots for vendors in the coming quarters. The tablet boom has faded in the distance and the market is fully mature. Global shipments declines are expected to continue unless vendors bring some remarkable new innovation to the market," said Tim Coulling, senior analyst at Canalys.
Market Declines Dominate the PC Landscape
Worldwide PC shipments (desktops, notebooks, two-in-ones and tablets) totaled 101 million units in Q1 2016, as total volumes dipped by 13 percent year-on-year to their lowest point since Q2 2011, according to the latest market study by Canalys.
Apple continued to lead the global market into the first quarter of 2016 with shipments of just over 14 million units, despite falling 17 percent during the same period. Meanwhile, Lenovo shipped 25,000 units less than Apple, as its decline moved into double digits on the back of weakening sales in Greater China. However, Google Chromebooks may continue to be one of the few notebook devices with upside growth potential.
Apart from two-in-ones, which grew just over 13 percent, shipments were weak across all categories, as vendors struggle with declines in global PC demand. Tablets continue to be the worst affected category, with shipments falling around 15 percent to just under 39 million units. Furthermore, the current tablet market outlook offers no hope of an apparent recovery.
All PC categories in Asia Pacific continue to experience weakness, affected by improving quality and falling prices in the smartphone market. In low-income markets, notebooks and tablets are no longer must-have products and multiple device ownership is becoming less common.
PC shipments in Asia Pacific and Greater China dipped 14 percent as the Chinese market saw its third consecutive quarter of double-digit declines.
Shipments in EMEA declined 15 percent, as notebooks were 18 percent lower than the previous year. Nevertheless, according to the Canalys assessment, since the inflationary effect that Windows with Bing had on shipments has ceased in Q2 2015, declines in the notebook PC market will reduce next quarter.
While annual comparisons in Western Europe are likely to improve next quarter, markets in the Middle East and Africa region will continue to struggle due to a challenging macro economic environment.
Small Pockets of Growth in Select Markets
North America was the best performing region in the quarter, with PC shipments still falling by around 5 percent. The tablet market in the U.S. was somewhat aided by shipments of large screen detachable tablets -- such as the iPad Pro and the Surface Pro 4.
Shipments of two-in-ones and detachable tablets are expected to continue to do well in the U.S. and will grow in high income markets. New form factors will trigger an increase in PC ASPs, potential providing a benefit for the two-in-one and tablet categories, at the expense of traditional notebook PCs.
That being said, the number of people looking to buy their first PC is at an all-time low, and 2016 is likely to bring yet more turmoil to global PC vendors. This is the new 'normal' for the personal computing sector.