The Future of Laptops

7 03 2011

According to this Globe and Mail article, PCs are losing the interest of the public.

Gartner Inc. cut it’s forecast for the sale of PCs in the future after global sales failed to reach the projected preliminary forecast. The IT-research company attributes their adjusted forecast to markets over the world exhibiting less demand for the traditional PC, particularly the ever-growing market of China. The company attributes this decline in demand to the tablet PC. Since the explosive launch of the iPad, consumers “appear to be hesitating” to buy traditional PCs, but instead await new tablet computers. This decline also comes amid the announcement of the launch of the new and improved iPad 2.0, the anticipated launch of Blackberry’s playbook, and the proclaimed “iPad Killer” – the Motorola Xoom. These are the newest and hottest “fashions” of technology that everyone wants to get their hands on.

Consumer taste’s are changing, and thus the demand of tablets rise, stealing customers from PCs. The less buyers there are the more the demand will drop. China’s giant population also contributes to the giant change in demand. More and more Chinese consumers are emerging in the middle class, with more money and buying power. Tablet computers definitely cost more than PCs do, but with the stronger spending power will cover the gap.

The manufacturers of PCs will lower the amount produced because they expect the price of PCs to drop. The seller’s expectations will lower supply so that they will not have a surplus in the future. IT companies also realize that these tablet computers will be the next big driving force in the sector and see it as a profit of another good. They will shift their resources to adapt to the changing market. This will also decrease the supply produced.

Also note that on the graph, demand is shown as decreasing more than supply. The reason for this is because most IT companies have not developed advanced enough tablet computers to sell competitively with market leaders Apple, Motorola, and Blackberry. They are forced to continue marketing their PCs until they are able to enter the tablet computer market.



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