More Smartphones than PC’s Shipped in 2011

According to a piece on Engadget (quoting research from Canalys), there were more smartphones shipped than PC’s in 2011. Even if tablets are included as a “PC”, there over 487 million smartphones shipped compared to a little over 414 million PC’s. The PC’s break down further into 29 million netbooks, 63 million tablets, 209 million notebooks and 112 million desktops. While it is important to remember that is “shipped” and not necessarily “sold”, the numbers are telling. The comments in the Engadget piece are also amusing, given the degree of disbelief in the desktop number (many feel it is too low). The commenter’s contention is that “many people build their own, so that would increase desktop numbers”. I have news for the commenters: if my circle of friends are family are any indication (and I know quite a few technical people), fewer than 1% of people who own or buy a PC would either build one of have one built custom. That is reserved largely for technically savvy individuals, people who want something very, very specific or gamers. I find it very hard to believe that there are tens of millions (or even 100+ million) custom PC’s made every year.

With that out of the way, the rest of the numbers are interesting. Not surprisingly, the netbook continues to see considerable decline, most likely at the hands of tablets like the iPad and Kindle Fire, as well as smartphones. Given the role of the netbook (highly portable, modest functionality), most tablets meet or exceed them. The graphics processing, for example, is orders of magnitude better on an iPad than pretty much every netbook out there. Most netbooks don’t have a dedicated graphics card. They use the cheap processing that comes with the Intel chipset. The iPad, though, uses a pretty sophisticated multi-core GPU, with dedicated memory and fairly sizeable 3D processing power (for it’s size, anyways). So, while a netbook is adequate for web browsing, e-mail, social media and some document editing, most tablets do all that and more. The apps for tablets are built for touch interfaces and more limited storage and memory resources (netbooks run the same heavyweight software used on much more powerful laptops and desktops). There are some very rich and sophisticated games available, running with levels of detail and frame rates that would make some conventional desktops blush. Netbooks are lucky to run most 1st person shooters at about 10 frames per second (or worse). It’s like watching PowerPoint, not like playing a game, in most cases.

One could try to argue the PC numbers have declined because of current economic conditions. There could be some merit to this. Consider that a number of smartphones are offered free with some wireless contracts, so the cost is spread out over time. A new PC can require a big chunk of cash up front. I would guess that the drop in PC’s mainly due to a drop in retail sales, given the still robust level of enterprise acquisitions that still seem to be occurring (and a lot of businesses lease their machines, spreading the cost out over time). Even some tablets are subsidized, so that would help to contribute to tablet growth over the rest of the PC market.

The rise in smartphones is certainly no surprise. Their volumes have been steadily increasing, as some people are replacing their feature phones with smartphones, and as some number are also looking at them as a netbook replacement. As more and more people come to depend on them, and the smartphone evolves into a more sophisticated “wallet” for payment and possibly identification, feature phones are likely to dwindle to almost nothing. People are getting used to having a computer in their pocket or purse, and some are starting to depend on it.

The biggest winner in 2011 was Apple. They are (for now) leading in smartphones and tablets, and the Mac has become a significantly larger part of the PC market. Nokia was displaced as the leading smartphone manufacturer (by Apple) and RIM has slipped to 4th globally (having been number 2 in the world just a few short years ago). The Canalys release tries to paint a rosier picture for Windows Phone, Nokia and RIM than I believe warrant. Consider Windows Phone’s continued presence at the bottom of the charts, Nokia’s fall from the top, and RIM’s dive to the bottom. Yes, RIM experienced modest growth, but “a rising tide lifts all boats”. Their plunge from being second only to Nokia in smartphones to a rather distant 4th is a trajectory to a less than ideal place. Windows Phone is the only platform that has gone nowhere, it’s few gains in some quarters offset by losses in share in others. I’m not sure that Nokia is going to make a difference, no matter how nice the hardware is. It’s the ecosystem, and Windows Phone is still trailing far behind iOS and Android when it comes to that.

These numbers continue to confirm the trends many have spoken about: the ongoing rise of mobile devices, tablets supplanting traditional PC’s, and the solidifying of positions for iOS and Android.

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