They are still the kings. Despite an overall market decline, thanks to ultrabooks and tablets, Hewlett-Packard still tops all desktop computer manufacturers in overall shipments. It has retained this top spot for a good many years now, and currently holds 16 percent of the world desktop PC market share. But time might be running short for the reigning champs. There are plenty of companies, many with competitive advantages, that could unseat HP in 2013.
HP’s past advantages
Why have people continued to buy HP desktop computers? Because they provide the combination of convenience and price. The typical HP desktop is a relatively small-sized tower. There is relatively little setup, so consumers can go from box to internet in no time flat. It also doesn’t have many bells and whistles, making it perfectly convenient for casual use.
HP’s problem stems from the budding ultrabook and tablet markets. They both provide portability and power — power that users could only previously find in a desktop. They are also more convenient than desktops. That is to say, many casual PC users will switch to ultrabooks and tablets, because they provide much the same experience as a PC with even more convenience. The desktop market will go to specialty PCs, which is not at all HP’s specialty.
Who are the top contenders? They’re certainly ones you’ve heard of, and they each bring something to the table.
By this point most consumers have heard of the Chinese brand Lenovo. They’ve been a prominent name in PCs stateside for years now. In fact, they made a big splash when they acquired IBM’s famous ThinkPad line of laptops in the mid-00s. Lately they’ve shot up the PC charts with their multiple lines of specialty PCs. It is one reason they continue to thrive — they grew 14.2 percent in 2012 despite an overall market decline.
Lenovo sets out to create the best desktop computer in a number of niches. This includes home entertainment machines, home office machines, and gaming machines. So while the casual user might choose a tablet or ultrabook, music-obsessed users might prefer the power of Lenovo’s media desktops. Gamers will prefer its powerful graphics card and processors, while small business users will enjoy the versatility and customization of its desktops.
Even absent further HP decline, Lenovo will almost certainly top the PC charts in 2013. They’ve been moving in that direction for years.
A little more than a decade ago Dell was the preeminent PC manufacturer in the US. Similarly to HP in the 00s, in the 90s Dell provided the easiest interface for consumers. They could buy relatively cheap Dell machines, plug them in, and be up and running with little effort. But as time wore on Dell’s weaknesses were exposed. Their customer service, dubbed “Dell Hell,” caused many consumers to buy machines from other manufacturers. They didn’t have to wait long, either: durability was not a feature of Dell computers.
In the past few years Dell has tried to move away from the declining PC market and towards enterprise functions. They’ve spent plenty on acquisitions in that space in the last few years. But the majority of their income comes from PCs, so they will still focus on that to an extent. And they might have more control over that destiny as well. They could go private, soon, giving founder Michael Dell more flexibility to improve the PC side while growing the enterprise side.
Dell might never reign over the PC market as it did in the 90s, but it could trump HP in 2013.
While Acer currently holds a larger share of the PC market, ASUS could very well be the bigger long-term threat. In 2012 they increased their market share from 5.7 percent to 6.9 percent, while HP, Dell, and Acer all saw their market shares decline. That represents 17.1 percent growth, more than any other PC manufacturer — even Lenovo. Along the lines of Lenovo, ASUS is succeeding through a wide and versatile line of PCs.
While it does sell traditional PCs, dubbed “Barebone,” ASUS has two very interesting lines of desktops. Their Eee Box PCs are absolutely tiny. That gives them a level of portability you don’t see with most desktop computers. Just hook up to a monitor and you can really take the Eee Box anywhere. Their All-in-One PCs in many ways resemble the iMac line, in that they are just one piece. Again, that adds a level of portability and style that most manufacturers don’t offer. Add in touchscreen interfaces and Windows 8, and it’s a combination that consumers will certainly prefer going forward.
True market shifts take years to work out. It took Dell years to fall from the top. In the same way, HP will make a slow decline. Their product is admirable in that it is predictable, and consumers have typically preferred predictability. But with the changing PC market, thanks to ultrabooks and tablets, innovation is needed to stay afloat. Companies like Lenovo, ASUS, and Dell are striving for those ends. HP, it seems, is destined to decline.