IDC: Grim Outlook For PCs Not Helped By Free Windows Upgrade

Analyst house IDC has warned PC shipments will continue to fall, as political uncertainty, currency weakness and depressed commodity prices all take their toll.

The forecast makes for grim reading for PC makers, already battered by years of falling sales and tough competition.

Increased Decline

The updated forecast, predicted that worldwide PC shipments will decline by 7.3 percent year-over-year in 2016.This is 2 percent below previous predictions and IDC has blamed this on the fact that “conditions have been weaker than expected.”

And going into 2017 things don’t look a great deal better with a smaller decline predicted. Stable volume is eventually forecast to return in 2018.

“Growth in the first quarter of 2016 (1Q16) came in at -12.5 percent, just below the forecast of -11.3 percent, and inhibitors such as weak currencies, depressed commodity prices, political uncertainty, and delayed projects continue to constrain shipments,” said the analyst firm.

It seems that falling growth rates for phones and tablets, which could help ease the pressure on the PC market, has not translated into stronger PC shipments.

IDC blames financial pressures on customers, coupled with the availability of alternatives for computer users. In particular, it cites the ability of PC users being able to delay a PC replacement by making use of the free Windows 10 upgrade, or instead relying on other computing devices.

The analyst house noted that while a large share of enterprises are evaluating Windows 10, the pace of new PC purchases has not yet stabilised commercial PC shipments.

PC makers are also making a growing challenge from the arrival of “detachable tablets” such as Microsoft’s Surface Pro machine. IDC says that prices and specs for this form factor “increasingly compare favourably against notebook PCs.”

When detachable tablets and PCs are combined, the market is projected to only decline by just over 2 percent in 2016 with small positive growth in later years, though still falling well short of peak shipments, said IDC.

Windows 10 Upgrade

“The latest update reflects continuing pressure on PC shipments, but does not significantly change the factors driving the market,” said Loren Loverde, VP Worldwide Tracker Forecasting and PC research. “In addition, we have now had four consecutive quarters of double-digit volume declines.”

“This type of prolonged slump is unprecedented, and lowers the bar for some improvement going forward,” said Loverde. “Unfortunately, the PC market still faces some persistent challenges, and for now, improvement continues to mean slower declines.”

IDC’s warning about the impact of the free Windows 10 upgrade and the arrival of hybrid devices such as the Surface Pro, seems to suggest that Microsoft has scored something of an own goal lately.

Last month Microsoft backtracked after it was accused of tricking customers into upgrading to Windows 10.

The issue concerned a pop-up box advising users to upgrade to Windows 10. Users clicked the red cross (X) in the top right hand corner, which previously closes the notification and postponed the update. But some noticed that clicking the X activated the upgrade instead of closing the pop-up box.

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