Column: Innovation can be a tall order for a PC vendor


Column: Innovation can be a tall order for a PC vendor

Microscope contributor

There was an interesting (if throwaway) comment by Gartner research director Ranjit Atwal last week when he was reflecting on how the PC industry would fare in 2012, writes Billy MacInnes.

On the back of figures that showed shipments in Western Europe declined by 3.1% (although the UK fared better with a 2.4% increase), he said there was a sense PC vendors were waiting for Windows 8-based PCs and ultrabooks to arrive to get the market moving again.

Atwal added: "The way they can differentiate themselves from their competitors will again come down to price, unless there is innovation in form factors."

Some people might argue that using the word "innovation" in conjunction with the PC industry is an oxymoron. After all, as Atwal's statement makes all too clear, the PC vendors are dependent on the efforts of two companies, Microsoft and Intel, to spearhead their next sales surge.

Obviously, a market so tightly aligned to the product development of two companies to provide it with the hardware and software platforms to drive its growth, leaves very little room for differentiation except on price.

Some vendors may well seek to introduce "innovation in form factors" but they tend to be the exceptions rather than the rule. And those "innovations", such as they are, tend to be minor amendments or design alterations that rarely justify a significant price differential compared to other products.

One factor Atwal neglected to mention was "brand value" and there is an argument to be made for suggesting people might pay a little bit of a premium for a particular brand compared to others. Quite how much more is an interesting debate that brand companies need to ensure they get right if they don't want to lose sales.

Even if they won't pay a premium as such, the value of a brand is that it gives a vendor a potential head start with the customer in terms of recognition and comfort. In a market where a lot of the products look pretty much the same and do pretty much the same thing, brand recognition can sometimes be the thing that swings the deal.

You could argue the great difficulty for PC vendors is that they are, to a large extent, little more than resellers of Microsoft and Intel technology. In many cases, the service and support they offer around their products is no better or worse than that provided by their competitors. With so little "innovation" of their own, they are left with little else to deploy as a weapon against competitors than price.

To date, quite a few companies have made a reasonable living out of this state of affairs and many will continue to do so. Perhaps that says something about the "innovation" in the way they have developed their businesses to successfully sell their (Microsoft and Intel) products and perhaps, in the end, that's all the innovation they need.

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