Arik Hesseldahl

Recent Posts by Arik Hesseldahl

PC Industry Train Wreck Hammers Taiwanese Manufacturers

Not that we really needed one, but here’s another sign of the historically bad patch the personal computer industry is going through.

Research firm IHS checked in with contract manufacturers who built notebook PCs for the likes of Hewlett-Packard, Dell, Apple and others during the first quarter of 2013. The result: The number of machines they’re shipping has reached a three-year low, tumbling to 33.2 million units, down from 40 million in the same period in 2012.

The decline was expected, but the final result was actually four or five percent worse than even the most dire predictions made last year. Peter Lin, an IHS analyst, blamed weak economies in major regional markets and a build-up in inventory of older machines. But there’s also a lot of competition from tablets like, you know, the iPad, of which Apple sold 19.5 million units during the first three months of the calendar year.

Worst hit among the contractors was Quanta, which builds machines for Apple, HP, Lenovo, Dell, Acer, Asus, Toshiba, Sony and Fujitsu and which saw its shipments drop 27 percent. Compal eclipsed Quanta as the top manufacturer in the quarter, according to IHS’ reckoning. It had relatively steady orders from Lenovo and Dell. The other three manufacturers rounding out the top five — Wistron, Inventec and Pegatron — all saw declines, too. All are based in Taiwan.

It’s just the latest indication of the nasty train wreck that the PC industry has been of late. In April, research firms IDC and Gartner both reported the worst quarterly PC sales figures since records have been kept. And those figures have been showing up in the quarterly earnings reports of all the major PC manufacturers including HP, Apple and Dell.

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Just as the atom bomb was the weapon that was supposed to render war obsolete, the Internet seems like capitalism’s ultimate feat of self-destructive genius, an economic doomsday device rendering it impossible for anyone to ever make a profit off anything again. It’s especially hopeless for those whose work is easily digitized and accessed free of charge.

— Author Tim Kreider on not getting paid for one’s work