The personal computing revolution
Mark Twain had once famously written, “ The report of my illness grew out of his (cousin’s) illness. The report of my death was an exaggeration.” Actually nothing had happened to Twain, he was not even ill, his cousin was. But Chinese whispers led to the belief that he was no more! With all the hype around tablets and smartphones, there is a prevailing opinion that personal computers (PCs) are facing an imminent extinction. And, we should place our smartphones into docking stations and attach our tablets to keyboards. Voila! We have changed the world.
This point of view needs to be examined. I have both a tablet and a smartphone. Yet, I am not attaching gadgets to my portable devices to make them do the work of a PC. Why would I convert a car into an amphibious vehicle like James Bond to make it fly or wade into waters? I am not writing this column on a smartphone or a tablet. I am writing it on a regular desktop using the most common word-processing application. Therefore, is the report of the PC’s death exaggerated? If it is so, then the world is a more complex place than it is being made out to be.
Let us look at the data. The share of Apple in PCs is about 10 per cent in the US. However, in the growth markets of the world, Apple’s share is 1.9 per cent in China and a mere 1.2 per cent in India. The overall share of Apple globally is less than 5 per cent. Turning to Google, how many of us use Android as the primary operating system (OS) on our desktop or laptop? When we have to write a long document, a column in a financial daily, a report or a book — how many of us write it on a tablet or a smartphone? If we have to do some serious financial modelling or prepare projections or create a presentation, how many of us do it on a smartphone or a tablet? If the answer is not many — then the report of the PC’s demise needs to be seriously questioned.
It is true that the ecosystems of PCs, tablets and smartphones are being disrupted by new technologies. They are dramatically changing the way we buy, store, arrange and retrieve content from anywhere on any device. But for now, multiple beasts like elephants, tigers, gazelles and zebras must coexist in the same forest. They will intrude into each other’s territories, and, sometimes one will provide lunch for the other. But with changing environments and disruptive technologies, companies will adapt, devices will morph and offerings will converge.
Most companies in the personal computing space are confused as Marty, the zebra in the animated film Madagascar. They are constantly asking themselves the philosophical “what am I” question. In the words of Marty, “I’m 10 years old, my life’s half over. And I don’t even know if I’m black with white stripes or white with black stripes.”
There is a huge battle in the market and in the courtrooms between Apple and Samsung. Followers of the Apple cult are pitted against the fan club of Android-powered Samsung tablets. Some believe it is a two-horse race. But is it? For a recent survey, Boston Consulting Group (BCG) polled American and Chinese citizens. The question asked was: Which OS they would prefer on a tablet? Surprisingly, Windows beat both iOS (Apple) and Android by a good margin. The report says, “Apple has established the dominant consumer-oriented ecosystem so far, but others are staking their claim — Google, Amazon and Microsoft among them.” And wait, there may be an unheard of company in China or India that could come up with a breakthrough product at an unbeatable price point.
It is safe to bet, however, that changes will see demise of products and companies and emergence of new services and offerings hitherto not even imagined. In the tablet space, we now have Kindle Fire. Amazon has deep pockets and has adopted the classic razor-blade strategy (you lose money on the razor and make money on the repeated purchases of blades), or, printer (lose money on a printer and profit from the annuity of ink cartridges).
So what does the crystal ball look like? In the near term, the tablet market will clearly expand and new players will come in. The new devices will enlarge the market for connectivity and content. While the US market will remain the most profitable, emerging markets will be an important theatre for the final battle for dominance and leadership Scale, volumes and sheer growth do make a difference. It is safe to predict that Apple will take a leaf out of Intel’s Celeron strategy book and focus on the emerging markets. The likes of Google and Microsoft, while waging the battle in the growth markets, will also venture to beard the lion in its own den through partnerships, alliances and acquisitions.
Customers will see a burst of creativity in how they find new answers to old questions. There will be constant innovation to help customers do their computing more efficiently and inexpensively from an appropriate device anywhere. And in the near term, we will see the competitive cohabitation of the PC, the tablet, smartphones and other mobile devices. Science facts do not yet support the science fiction vision of a single device doing everything, anywhere and anytime. For some time now in the personal computing race, there will be horses for courses.
(The writer is managing director of Deloitte Consulting, India.
These are his personal views)