Dell Forecasts Death of PC in Latest SEC Filing
Dell needs to shift as sales of traditional desktops and laptops continue to fall.
In a proxy statement submitted to the U.S. Securities and Exchange Commission on March 29, Dell invited stockholders to a special meeting on its Texas campus on an undisclosed date. Discussions include the company's plans to go private, and issues currently facing the PC industry. Among the topics is an admittance to the "uncertain adoption of Windows 8" and a need to move into as build-to-stock business mode.
In the filing, Dell acknowledges "fundamental changes in the PC market" which include a decline in worldwide revenues for desktop and laptop PCs, and lower shipment forecasts for PC products. There is significant and increasing competition, the company said, from efficient, low-cost manufacturers relying on the build-to-stock model, and those that produce innovative, higher-margin PC products.
Dell stated that long-term challenges effecting PC sales include the uncertainty around Windows 8, the lengthening on the replacement cycle of PC products, and the unexpected slowdowns in enterprise Windows 7 upgrades. Even more, the continued increase of consumer interest in tablets and smartphones will likely replace the desktop and notebook, and currently Dell only manufactures tablets in "limited quantities" – it has no smartphone portfolio whatsoever.
In the filing, the company also warned of the significant uncertainties as to whether, or when, the decreasing revenues in the desktop and laptop sectors will end – if at all. There's also the overall difficulty of predicting the market for PCs "as evidenced by the significant revisions in industry forecasts among industry experts and analysts over the past year".
Here are a few more problems Dell is facing: the ongoing downward pricing pressure and trend towards commoditization in the desktop and notebook personal computer market; and a shift in demand from higher-margin premium PC products to lower-margin value products. Dell also acknowledges the increasing usage of alternative, non-Windows operating systems for the PC, and the increasing adoption of "bring your own device" policies by businesses.
Dell helped build the customizable desktop scene that we know and love today, but the company is now facing a different market that's fueled by the launch of the original iPhone and iPad. As stated earlier, the growing use of tablets, high-end smartphones and even ultra-thin notebooks is killing the traditional desktop and notebook market as more computing power is packed into these highly mobile form factors.
Like HP, Microsoft, Google and even Nvidia, Dell will need to diversify, to address the mobile consumer-based "BYOD" market that's slowly being allowed into the company's coveted enterprise market.
I guess Dell is trying to say that since their company is declining, the PC market is. Which is the dumbest thing I have heard. It's called user awareness and as users become aware of what their buying they turn to better deals or the DIY market.
I guess Dell is trying to say that since their company is declining, the PC market is. Which is the dumbest thing I have heard. It's called user awareness and as users become aware of what their buying they turn to better deals or the DIY market.
The majority of people are no where near this level of adoption though. We still haven't got the internet everywhere yet in the first world, let alone in less developed countries.
The PC as we know it will be around for many years to come.
diy enthusiasts get screwed over by cpu companies every year.
pc gaming gets killed off by consoles every year or whenever a console, no matter how minor or insignificant(psvita) launches.
dell captures the number one spot as pc vendor.
every one buys dell smartphones and tablets.
Absolutely. I dont think many PC enthusiasts are gaga about massive cases/power requirements/etc(ok, secretly we are)...but physical peripherals are essential to the gaming experience.
Hell, it be great if an Apple TV could run BIOSHOCK Infinite at 120FPS, Max Settings, 1440p...but until these watered down consumer devices outpace software, no thanks.
OMG, do they let anyone sign up on this site?!? News that's 2 days late. Lack of editing. More spam than any other tech site...
Sigh...
What gamer would want to play BF3 on a Dell? Just because enthusiasts want high end PCs and refresh doesn't mean the population as a whole needs or wants to spend money. They dont. And that's who Dell targets
The FACTS listed are fine and true. We arent on the upswing of the PC market. Sales are decreasing. But they certainly aren't about to die. Other devices are taking money/market share. And Dell needs to adapt. So why is everyone commenting on the title? That's not what Dell said, that's just a bad title picked by a reporter to get clicks.
If Dell is targeting people that don't want to spend money it's no wonder they are going broke.
Here's a list of things that will prevent the PC from going tits up:
Desktop editing
Workstation applications
Architecture
CAD
Spreadsheets/accounting
Photo editing
All of these require large screens and PC levels of processing power (yes, higher end laptops can manage)
No iPad, Android or Surface is gonna be able to do that.
I haven't touched on gaming because there is something intimately creative about building your own rig. Aside from wanting epic levels of performance, we want things our way and again no consumer level of touch screen device is gonna do that.
The PS4 and Xbox 720 may be leading edge (doubably) on launch but in 2 years they are gonna be behind the times. There is a place for console gaming and it's successful for what it is, but with the advent of mobile gaming, they are gonna have to change the formula of waiting 7 years between refreshes.
It will always have it's place like others have listed (especially with gaming), but it requires companies to not cut corners like dell did with many of their systems.
For example, charging $1000 for a computer and having it stuck with some intel onboard crap and a 300 watt power supply.
or ruining their reputation further by buying alienware and continuing their ripoff habits. it is almost like if a company like steam/ valve kept everything the same except the adding of a nazi squad to go and spread torment and racism. even if the steam service it's self stays the same, it will likely begin to do poorly due to their other unpopular actions.
Buying alienware is like tying a a large cinderblock to your testicles and then going swimming, things just wont turn out well.
If Icahn takes control, Dell won't be able to make drastic moves to reinvent itself as a post-PC company. Michael Dell will probably have a restraining order and after Icahn has made his billions, the company will burn to the grouond. If the white knight Michael Dell and his friends take over, you won't see what Dell is doing each quarter, and after disappearing for a while, the company will reappear as an awesome new tech firm. That's the idea here.