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Lenovo: PC Industry Underestimated Demand for Touch

In a recent interview with CNET, Lenovo's president of the North American region, Gerry Smith, said that the PC industry underestimated the popularity of touch.

The news is a little surprising given that a good number of the computing public uses a touch-based smartphone, tablet ot handheld console. The obvious desire to manipulate images, apps and other virtual objects with a fingertip should be seemingly clear, a trend that Microsoft even sniffed out and focused on when developing Windows 8. Trouble is, you'll be hard pressed to find a desktop or laptop that actually supports touch on the market today.

Naturally the cost of adding touch-based capabilities has been a huge factor for manufacturers, but prior to the launch of Windows 8, there was also a general consensus that there simply wasn't a huge demand for touchscreens. But the industry was wrong, and the immediate high demand for touch-based desktops and laptops has left OEMs unable to keep up with the demand.

Up until October 26, the industry was hoping that the launch of Windows 8 would reinvigorate the PC market. But according to NPD, sales of Windows-based devices actually dropped 21-percent during the initial four-week launch compared to the same time period in 2011. On the other hand, touchscreen desktop sales are actually doing better than expected, but the numbers are limited because vendors weren't prepared for the high demand.

"As you go through any major architectural transition, you try to forecast accurately how much the attach rate will be on touch [or other features]," Smith said. "Across every major [shift] over the past 10 years, we're never right. The learning is, how do you respond to that? How does the industry change and evolve?"

Moving forward, he said the industry will have to determine how "off" it was about the demand for touchscreens, and to figure out what it can do to prevent a similar scenario in the future. Smith said the touch panel supply is improving, and more touch capacity should be available in the first half of 2013 to help meet consumer demand.

Smith also noted that this improvement in supply is crucial, and more and more computers will likely switch over to touch-based panels. Even Lenovo predicts that 50-percent of its desktops and laptops – excluding tablets and smartphones – will sport touchscreen within the next two or three years.

Missing the touch-based forecast was actually great news, he said, because if touch turned out to be a disaster, then OEMs would have had a frightening stockpile of unsold products. "I view it selling well, a shortage, everyone chasing supply as a huge positive because it shows market potential and it shows a huge market opportunity," Smith said.

Despite the current supply shortage, Smith said that Lenovo is experiencing strong sales of its non-touch PCs. Even more, he's noticed that sales of premium-priced computers are growing faster than other PC segments. Lenovo is a little different than the others, he said, an anomaly in the global PC market thanks to its high exposure in China.

While the company has consistently been gaining market share, competitors like HP and Dell have pulled back, CNET reports. Currently Lenovo is pegged as the largest PC vendor on the planet (although IDC disagrees, favoring HP), and the company is looking to dominate the North American market as well.

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