Gartner: Mobile Devices Continue to Eat Away at PC Usage

If you just gazed at the top-line numbers, you would think all is right in the IT world. But that is only if you have been living under a rock.

Research firm Gartner is predicting worldwide combined shipments of all devices—that includes mobile phones, ultramobiles, tablets and even PCs—are expected to hit 2.5 billion units in 2015, 2.6 billion in 2016 and 2.7 billion in 2017.  This year’s shipment volume would be a 2.8 percent increase over 2014 levels, which came in at 2.4 billion.

However, drilling down deeper, the numbers show what service providers have been experiencing firsthand for the past 10 years: Mobile devices, specifically phones, are exploding, and PCs are … well, not. In fact, the global PC market is expected to total just 306 million units this year, a 2.4 percent drop from 2014 when 313 million units were reportedly shipped, according to Gartner. As a result, PC prices are actually on the rise to try and make up some margin.

Gartner points to currency changes as one of the main reasons for the stall in PC shipments but no solution providers I speak with regularly rely on PC sales as a cornerstone of their business anymore. Even though Gartner does expect PC unit shipments to rise again in 2016 and 2017, it is insignificant compared with mobile phone shipments.

"The fall in PC purchases is primarily due to expected price increases by vendors in Europe and other regions, which is forced by local currency depreciation against the dollar," said Ranjit Atwal, research director at Gartner, in a prepared statement. "The currency squeeze is forcing PC vendors to increase their prices in order to remain profitable and, as result, it is suppressing purchases. We expect businesses will delay purchases of new PCs, and consumers will delay or 'de-feature' their purchases. However, this reduction in purchasing is not a downturn, it is a reshaping of the market driven by currency." 

On the positive side, to no surprise, the mobile phone market continues to be the largest and most profitable segment of the global device market. Thank you very much, Apple and Samsung.

Total shipments of mobile phones are expected to increase to 1.943 billion units this year, a 3.5 percent rise from 1.878 billion units in 2014, according to Gartner. This pace is not expected to slow, as the research giant expects 2.017 billion mobile devices to be shipped next year and then 2.055 billion in 2017.

As demand has risen over the last few years, so have mobile phone prices, but Gartner said that should flatten out as cheaper devices enter the market. "Consumers will continue to prioritize spending on phones over PCs and tablets in 2015," said Roberta Cozza, research director at Gartner, in a prepared statement.

Further, ultramobile devices (including tablets and clamshells) are also expected to continue to rise going forward, with worldwide shipments expected to reach 237 million units this year, a 4.3 percent increase from 227 million unites last year, according to Gartner. The next two years, this market will continue to rise and even surpass PC shipments by the end of 2016.

"Following rapid growth, the current mature consumer installed base for tablets is comparable to that of notebooks," said Cozza. "Not only is the tablet segment nearing saturation in mature markets, but the influx of hybrids and phablets will compete directly with tablets in emerging markets."

Solution providers already have been building their business and services around mobile devices. This obviously needs to continue.

Knock 'em alive!