PCs About To Leave Center Stage

The PC’s status as the dominant device in the access portion of the digital marketplace will sputter to an end within six years, say researchers at International Data Corporation (IDC) in a new study. Further, the survey predicts that if vendors of PC-related technology do not jump into the connected appliance market soon, consumer electronic suppliers will.

At the end of the transition in 2004 or 2005, the study said, PCs will still have a growing market. But PCs will be dwarfed by demand for digital consumer appliances that have built-in connectivity and cost relatively little.

Gadgets like TV set-top boxes, World Wide Web-enabled telephones, Web-enabled personal digital assistants (PDAs) and Web-enabled video game consoles will drive a near tripling inthe annual volume of access device shipments from 1997 to 2002, and exceed PC shipments by 2004 or 2005, the firm predicted.

Frank Gens, IDC’s senior vice president of research, said the main players at most PC-related companies already know the transition is coming. "Their job now is to lobby the rest of their companies to start shifting now, not later," he said. "It’s kind of like the PC guys at IBM, Digital and Wang in the early 80s. The parallels are quite strong."

He added, "There’s a rich irony here, in that very high volume, low-priced appliance models are taking off. The appliance model may do to the PC guys what the PC market did to the mainframe and mini guys."

Gens recommends that companies that make their living "from PC dominance" fundamentally reassess their market strategies.

Connected, low-cost devices will put a lot of demand on the network and specifically on servers, Gens said, and the major operating system (OS) vendors are already fighting to control the platform.

"If you look at Sun, they’re betting heavily that Unix and Java will be better at running the new system than other systems," Gens said. "Microsoft is pushing hard to get Windows CE into as many appliances as possible."

He says IDC thinks that putting CE into devices like wireless phones is a "stretch," but gadgets like HPCs (hand-held PCs) have a "natural affinity to PCs," and make more sense for CE.

"The real battleground right now, is what is the software platform going to be for the different classes of these appliances," Gens said. "Can there be a common platform across phones, set-top boxes, connected terminals, Web-enabled information appliances and so forth?

"It could be that we’re looking at the PC wars of 1977, 78, 79, and the real dominant platform may not show up for a few years. That’s what happened with PCs in the late 70s, early 80s. But there’s no question pressure is building because the industries that want to do business on the Web don’t want Balkanized access to the market. They want to be able to reach everybody."

IDC’s Web site is at http://www.idc.com.