HP sees the two business groups — IPG sells printers both to consumers and businesses, and PSG sells PCs to consumers and businesses — as making more operational sense combined than apart, the source said. The plan is to have their line of business more readily integrated so they can approach customers together and with unified product offerings.

IPG was once the financial engine seen as keeping the rest of HP flush. It sells more printers than anyone else in the world, but makes most of its money selling ink cartridges and other supplies that tend to make higher profit margins than the printers themselves.
However, the IPG unit has seen its business decline in recent years. In its most recent quarter, HP reported that sales fell by 7%, to $6.3bn, while the unit’s earnings from operations fell by 32%.

PSG is the least profitable division in percentage terms. This will make it harder to see how HP's PC business is doing, too.

Sebastian Peitsch:

"Something must have gone horribly horribly wrong over at Deutsche Bank because I just don’t see THAT much of an effect. I don’t know what Chris Whitmore did but there’s just something wrong with his math. Global PC sales were 92 Million in Q3/2011 including 5 million Macs sold by Apple. They also sold 11 Million iPads which brings the total number up to 103 million “PCs”. If you look at the Deutsche Bank numbers HP has a market share of 17% (Gartner gives it as 17.7%). To make them drop off to under 15% as the Deutsche Bank graphs shows Apple would have had to sell over 18 million iPads which they simply didn’t."

Analysts, eh.

The point about the PC market at present is that it's the consumer part of it which is down, not the business end. The choice of whether to buy a tablet or a new PC (laptop, notebook) is an either/or for most people. It seems they're opting for a tablet.

Having read a Verge review of the Samsung Chronos, Matt Gemmell is moved to write. "You, the PC consumer, simply shouldn’t be putting up this sort of situation. Low expectations permeate the PC press, due to the type of products foisted upon the market for many years. Poorly-integrated plastic boxes (often poor copies of existing products), optimised for cheapness of manufacture and co-branding opportunities, resulting in horribly compromised products for the consumer.

"There are certain companies out there who wouldn’t allow a product with even one of those flaws to ever make it to manufacturing. It’s a terrible indictment of the PC industry that even journalists often don’t expect anything better."

How? By selling ultrabooks as part of a 10% increase in notebook shipments in 2012. "Many notebook PC and chip makers have said the slicker ultrathin notebook PCs, dubbed 'ultrabooks,' would likely be a game changer. But analysts say it is too early to gauge whether they can grab some market share back from tablets, as the first batch of ultrabooks only hit the market earlier this quarter.

"[Chief executive] JT Wang said: "Ultrabooks will become our key growth driver next year as customers want a lighter, thinner notebook with longer battery life. Selling more ultrabooks will also help improve our profit margins as they command higher prices."

Selling Apple-like designs at Apple-like prices is the way forward for Windows OEMs?

"We are hearing that Microsoft’s fee for Windows 8 tablet version could be as high as $68. If that is true, right off the top the BOM costs of Windows 8 tablets will most likely force prices higher than Apple’s low-end iPad is today. And if Apple starts lowering their prices in 2013 as I suspect they will, Windows 8 tablets would be at premium pricing.

"Also, while Microsoft and Intel and their partners are excited about ultrabooks, their current pricing is too high for consumers. ...

"And even if Android tablets start gaining market share in consumer markets in the future, most of them are coming from non-PC vendors. The major PC vendors are winding down their Android tablet programs and all the big guys will be backing Windows 8 by the end of 2012. They must hope that Windows 8 tablet is a hit for this to give them any market share boost over Apple."

That Windows tablet licence price is higher than that for Windows on OEM PCs now.

Patrick Moorhead: "It all starts with the end user and making choices. If posed with the question, “if you had to choose between your phone of the PC, which one would you pick?” Sure, most want both, but making them choose makes them prioritize, and most would pick the phone. Why? One reason is that its so personal. People take it in the bed, bathroom, our pocket, on the dinner table. It knows where we are, what we’re doing, who we’re with, can communicate how we feel, etc. There are even reports that people would rather starve or refrain from sex rather than separate from their phone. Net-net, the phone is more personal and one variable that could, scenario speaking, accelerate the erosion and “take down” of the PC."

More that the phone gets more use than the PC, which thus gets replaced less often.

"Speaking at Dell World 2011, Otellini told an audience of industry executives that Intel loves PCs. 'I suspect Steve Ballmer said the same thing this morning and I know that our partner Dell absolutely loves PCs,' said Otellini. He continued to say that Intel and Microsoft have built a “wonderful industry” and that he believes PCs are now being taken for granted because they’re so useful. 'To some extent the evolution of the PC has been retarded I think in the last few years so as we look forward in terms of where the PC has to continue to grow…it has to get more and more consumer friendly.' Intel plans to solve the problem with Ultrabooks. 'We want to make sure that these devices are portable, user friendly, but also have the capability to do the high capacity creative work that all of our workers do day in day out,' said Otellini."

Ultrabooks, eh?

Subscription required. Extract: "Mr Dell believes we are not yet in a post-PC era.<br />
“'There are a billion and a half PCs in the world and while Gartner change their estimates here and there, they also estimate there will be two billion PCs in the world by 2014. So when I look at that, I think the idea that the PC is no longer here is complete nonsense,' he says.<br />
“'You see PCs, tablets, you see smartphones. But those other devices aren’t necessarily replacing the PCs, so we are very committed to that part of the business, as part of this broader, end-to-end IT solutions company,' he says. PC growth will come mainly from emerging markets, such as China, he says. China is also a big market for Dell’s servers, as a result of deals with big internet companies such as Tencent. 'Around 60% of the Chinese internet runs on Dell,' Mr Dell says.

"My desktop isn't the only computer I plan to replace in the next few months. I need a new laptop too, and my goal is simple: to find a 13" MacBook Air that isn't made by Apple.<br />
"It turns out that I'm not the only one wanting this mythical non-Apple MacBook Air. Intel wants them too—it calls them Ultrabooks. The chip company has been kicking the Ultrabook idea around for a few months now, and it has grand ambitions: by the end of next year, it wants 40% of PC laptops to be Ultrabooks."<br />
<br />
To which end it has a $300m fund to "invest in companies that are working to build that kind of hardware - ultrathing, rapid boot, metal case, long battery life, long standby time.<br />
<br />
But as the article shows (and other analysts agree) that's not so easy. A really good examination of why the PC OEM business can do some things really well, but others far less well.

Frank Shaw, Microsoft's head of PR: "over the years some of the great experiences first delivered on a PC have been extended to smartphones, internet companions, tablets and, yes, even our cars. Today, the PC and these companion devices are all nodes on the network, connecting to cloud-based services to deliver real-time stock quotes, sports scores, and other updates we can’t imagine living without.<br />
"I’ll be the first to admit that these new “non-PC” objects do a great job at enabling people to communicate and consume in innovative and interesting ways. That’s not surprising, because they were expressly designed for that purpose. But even their most ardent admirers will not assert that they are as good as PCs at the first two verbs, <strong>create and collaborate</strong>.  And that’s why one should take any reports of the death of the PC with a rather large grain of salt."<br />
<br />
We think there's a syllogism in that last bit.

"PC shipments in the China market have exceeded those of the United States in the second quarter of 2011 (2Q11). Approximately 18.5m units worth US$11.9bn shipped in China during the quarter, compared to 17.7m units worth US$11.7bn in the U.S. China represented 22% of the global PC market's unit shipments compared to the US at 21%."

Horace Dediu: "But that’s the nature of unforeseeable growth: you cannot foresee what will happen and plans never work out. Data and planning don’t help. The lesson is that you need to plan for that which cannot be planned. When you are at your peak you must assume failure is imminent and when you are at the trough you must assume success is inevitable.<br />
"All failures of strategy are rooted in the assumption that outcomes are predictable."

Interesting how HP, with its big corporate sales, is faring worse than the industry average.

"If the average selling price of a Mac runs about $710 more than a PC (ASP of a Mac - ASP of an HP machine), and about $320 of that is profit, then the remaining $390 must be those higher costs. Apple’s computing hardware, and the software development behind OS X, actually cost more to manufacture. Given the volume their manufacturing partners are turning out and the squeeze to contain costs put on them by Apple, one has to wonder why.<br />
"The answer is fairly obvious to anyone coming to Macs after years of using commodity PC equipment: better design and build quality costs more."<br />
<br />
In no way going to start an argument in the comments, this one.

"The Cube Enterprise directors' report leaked to El Reg blamed its demise on long term deflationary pricing; shifting consumer demand to tablet devices; a failed attempt to move into component reselling and households' falling discretionary spend.<br />
"In spite of these glaring issues, director Robert Drye had pinned all his hopes for the future on developing a hardware configuration tool to let customers spec PCs individually."<br />
<br />
Another one bites the dust. Perhaps Alan Sugar could make 'creating a PC business' a challenge in The Apprentice. We could do with a new British one.

An interesting data point from July 2008: "Gartner’s latest figures put the number of installed PCs worldwide as just having surpassed 1 billion units and at a growth rate of just under 12 percent annually, will surpass 2 billion units by early 2014.<br />
"So currently, it would appear, there are at least three times as many active mobile phones in the world as there are PCs, and internet access via the mobile phone is outpacing wireless access from a PC in many of areas of the world."<br />
<br />
Mature markets (North America, western Europe, Japan) counted for 58% of installed PCs, but just 15% of the population. Gartner expected uptake to increase rapidly in emerging markets. We'll have to ask them...

"North Korea might be an unlikely place to find a PC factory, but the country has started manufacturing three models of computers, according to a recent state TV report.<br />
"The report, on the country's main 8pm evening news, took viewers inside the factory that's making the computers. The factory and the computers are far removed from the advanced and automated production lines that churn out thousands of laptops each day in neighbouring China."<br />
<br />
They run Linux, in case you're wondering.

Confessions as in scams, not nudge-nudge. Such as: "Although the repairmen we spoke to stressed the importance of setting an upfront price with customers, they also explained that rogue outfits are more than happy to zealously undertake costly repair work, even if the final price outweighs the value of the computer.<br />
"The result, when the customer goes back to collect the computer, is chronic “bill shock”. Since the work has been done as per agreement, the cowboys claim they can withhold the machine until payment has been made.“We hear about it a lot, mostly with motherboards or laptop screens that are installed at an inflated price – perhaps up to £180 instead of about £100,” said Finlay. “As the work has been done, the customer effectively has to pay for it, even if it costs more than the laptop is worth. People should agree a price upfront and get in touch if there are any high charges, but not everyone does.”<br />
<br />
And those aren't even the worst scams.

"The software giant is expected to post earnings of 56 cents per share, up from last year’s 45 cents per share. Revenue is likely to increase by an impressive 12% to $16.2bn in revenue, up from $14.5bn in the same period last year."<br />
<br />
Might be the first quarter in decades in which Apple has the larger revenue and larger profit. 56c per share translates roughly to slightly over $5bn; Apple's profit last quarter was $5.62bn.

Qualities observed in people from the Hunch network. This is one that definitely wouldn't attract any comments, right?