The desktop PC has its place in the ecosystem.
- The silly season is starting early this year with the notion that Samsung is about to close its PCs business doing the rounds thanks to the Korea Times.
- What Samsung actually said was, “Demand for conventional desktop PCs is going down. We will allocate our resources to popular connected and portable devices”.
- This basically means that Samsung will prioritise its resources towards those devices which have the highest demand.
- It does not mean that Samsung will stop making desktop PCs and in fact it would be very foolish to do so.
- There are three reasons for this:
- First. Desktop PCs are declining but they still represent significant volumes.
- This means that there are significant volume discounts to be had when it comes to buying components that are common to all PC types.
- Second. Samsung has stated that it intends to become a top 3 vendor of PCs by the end of 2015.
- Samsung will not achieve this without having a position in desktop PCs which are likely to remain dominant in the enterprise market.
- Enterprise still makes up 50% of all PCs shipped.
- Third. Everything is becoming more and more digitised meaning that users are increasingly living their lives within a digital domain.
- Digital Life extends all the way from the desktop at the office to computing at home and on into tablets, consoles, TVs and smartphones.
- It is becoming increasingly clear that the winning offerings will be the ones that are able to encompass all use cases for Digital Life.
- Hence it makes no sense at all for Samsung to stop making desktop PCs but I would not expect it to focus much R&D or marketing in that direction.
- Samsung has everything in place to become a top three PC vendor over the next few years and this is a dream that I expect it to achieve.
- The losers here are likely to be HPQ and Dell who are still without a strategy to properly address the changing PC landscape.
- Samsung is one of the cheapest stocks in the technology universe at the moment making it worthy of consideration for those who can look beyond the next quarter’s shipments of Galaxy S4s.
Blog Comments
tatilsever
June 27, 2013 at 9:30 pm
> “desktop PCs which are likely to remain dominant in the enterprise market.”
I doubt that desktop PCs are all that significant in enterprise. Granted my experience is mostly based on US companies, but most if not all computers whose main purpose is editing documents or sending email has turned into laptops. Laptops cost more, but if the employees ever get some work done on them outside their cubicles for more than a few hours a year, the difference is worth it. There are many stationary PCs acting as dumb terminals, but the main work is done on a server somewhere else, so those PCs do not need upgrades very often. In any case, many of those dumb terminals are being replaced by mini tablets with special accessories such as barcode scanners. That leaves the servers running behind the scenes, but they are more likely rack mounted systems rather than the traditional desktops. That about leaves content creators and CAD tool users working in small businesses as the major category of future users. That might be a profitable segment, but I don’t see the volumes making a big difference.