Microsoft's slippery slope to oblivion

If there was ever any confirmation needed that the tipping point of the PC’s dominance as a computing platform has been reached, the IDC has just provided it with their latest report on PC shipments in the first quarter 2013. Worldwide PC shipments were down a massive 13.9 per cent from the same period last year.

Top 5 Vendors, Worldwide PC Shipments, First Quarter 2013 (Preliminary) (Units Shipments are in thousands) (Source: IDC)

The IDC analysts are pinning the blame for the drop on the decimation of the mini Notebook or Netbook sales and the shift in consumer and corporate spending on phones and tablets rather than PCs. The boost expected from Windows 8 just hasn’t materialised and seems to have had the opposite effect. Consumers have stayed away in droves from the new operating system, put off by the fact that it is a very expensive way of turning a PC into a tablet, when you can buy a cheaper tablet instead.

Apple was not immune from the drop in PC sales, with their shipments declining worldwide and by 7.5 per cent in the US. However, Apple partly makes up for its loss in PC sales with sales of the iPad. Not so for the others, including Microsoft which has seen lacklustre sales of its hardware in addition to its latest Windows operating system. The reaction to Microsoft’s role in the end of days for the PC market has been a downgrade of its shares from Neutral to Sell by Goldman Sachs and to Neutral by Nomura

Where to for Microsoft?

What's interesting is that analysts see any future at all for Microsoft. The world of computing is changing rapidly and what is absolutely clear is that Microsoft is singularly incapable of changing with it. The decline of the desktop is in full swing and the days of Windows as the dominant operating system are over. The many variants of Linux have taken over because they are significantly cheaper than and just as functional as Windows for everything from embedded devices to servers.

Microsoft’s delay in releasing a version of Office for platforms like Android and iOS has meant that people have found alternatives and discovered that they really could get along without the 90 per cent of the features they never used.

In the server software market, developers and IT departments have been hit with the huge (and rapidly rising) costs of using Microsoft database and web software, and have again discovered cheaper and sometimes free alternatives. That is if they haven’t moved away from supporting their own infrastructure and taken up cloud-based services anyway.

The times have now indeed become mobile, and developers are more interested in building apps for iPhones and Android than coding web sites on a Microsoft platform. Open source web development environments like Python and Ruby are becoming more accepted in even the largest enterprises and so Microsoft will find it increasingly difficult to compete with “Free”.

Eric Schmidt summed up the new technological zeitgeist by saying that the dominant “Gang of Four” companies shaping technology now had shifted from the  Microsoft, Intel, Cisco and Dell who reigned from the 1990s to Google, Apple, Amazon and Facebook today. I personally would include Samsung and am ambivalent about Facebook as ultimately the world would hardly notice its passing as something else (even Google ), took its place.

The ultimate disappearance of the PC will be noticed in the home first and will be quite rapidly replaced by tablets, phones and smart devices, especially the smart TV. The workplace will follow, although docking stations with screens and external keyboards may allow workers to plug in their mobile devices to allow for more sustained computer-based work. As this structural shift plays out, it’s hard to see a place for many of the current PC manufacturers in their current forms, nor of their former ringleader, Microsoft. 

David Glance is a director at the Centre for Software Practice at The University of Western Australia.