Chip makers downplay the impact of tablets on PC sales

22.07.2011
The post-PC era is not yet upon us, executives from Intel and Advanced Micro Devices insisted this week in conference calls to discuss their earnings, where the impact of tablets on their businesses was the big question.

The impact of tablets was felt more on netbook sales, which were below expectations during the second quarter, said Intel CEO Paul Otellini on an earnings conference call. Discretionary spending by consumers was going more toward tablets than netbooks, he said.

AMD officials concurred, saying tablets did not significantly cannibalize PC sales. AMD views tablets as a market opportunity complementary to PCs, said Rick Bergman, senior vice president and general manager of AMD's products group. AMD in June introduced its first tablet chip, and the company in the past was criticized for relying overmuch on the PC market and not quickly recognizing the tablet opportunity.

Gartner and IDC earlier this month reported slow gains in PC sales for the second quarter, partly affected by growing tablet purchases. Worldwide PC shipments totaled 84.4 million units during the second quarter, growing by just 2.6 percent year over year, according to IDC.

The share of netbook sales as part of PC sales during the second quarter was 12 percent, down from 22 percent four quarters ago, said David Daoud, research director of personal computing at IDC. The void left by slumping netbook sales wasn't filled by mainstream PCs, and PC makers are now scaling down netbook activity and investing more in tablets.

The tablet market is ruled by Apple, which sold 9.25 million iPads in the most recent fiscal quarter, an increase of 183 percent from the same quarter last year. Most of the Apple iOS and Android OS tablets today come with ARM processors, which are considered more power-efficient than Intel's and AMD's x86 chips. Intel and AMD are now developing faster and more power-efficient chips that can effectively compete with ARM processors in the tablet market.