Trends Driving the IT Hardware Industry Over the Next Three Years

With the explosive growth in the personal computing market, there has been a marked increase in the number of new inventions in the technologies used to power these computers. The market for laptops is similarly a high growth one, despite the ongoing recession, and contributes nearly 30% of the total sales in the market for personal computing devices.

Given this background, it is hardly surprising that there would be a move towards achieving greater efficiencies in this space with the accent on better, faster and feature heavy devices. This article considers the key trends driving the market for a new form of chip to power laptops that are expected to be better than the ones in the market.

The time frame chosen for the trend analysis is the next three years and as the article makes it clear, Moore’s law corresponds perfectly to this time frame as well as the key trends that are considered include globalisation of the supply chain, the effect of the ongoing recession on consumer and corporate spending, changes in consumer preferences for laptops and finally, the changes in technology that have spurred the introduction of newer products.

Moore’s Law

Any discussion on the potential for chips used in computers and laptops and the trends that influence such deployment for business purposes has to take into account the limits as well as opportunities presented by Moore’s Law named after Gordon Moore which states that computing power doubles every three years.

Hence, any analysis of trends as required in this article can be done over a three year period and is appropriate when one considers how computing power changes over time. Given the fact that laptop makers as well as chip makers are often in a race for time when it concerns the time to market and the turnaround time for their products to hit the market, the trends that can influence these decisions can be forecasted over a three period time at the end of which newer technology would have made obsolete the technology under consideration.

Effect of the Great Recession

One of the key trends that are going to affect the hardware industry as well as the laptop industry is the ongoing recession and its affect on the purchasing habits of consumers. With the onset of the Great Recession in 2008, the IT spends by the corporates as well as the retail consumers have come down significantly leading to an all round contraction in the amount of money spent on laptops.

This lowered spend on laptops by the consumers and the contraction in the growth figures of the computer hardware industry tell their own story. In a way, the onset of the Great Recession has made life tougher for firms in the global marketplace and as we have seen in the previous section, companies are increasingly accelerating the process of globalising their supply chains to meet the challenges of cost savings and growth in depressed economic conditions.

Globalisation of the Supply Chain

The next key trend to affect the deployment of the hybrid chip would be the trend towards sourcing components from where it is cheaper, building the laptop in a different place and selling the finished product where it is profitable.

This integration of the supply chain with the global economy has meant that companies around the world are looking to innovate across the supply chain and this opens up opportunities for newer and faster chips like the one under discussion to be introduced into the market.

Given the fact that countries like China and India which are at the forefront of manufacturing at cost effective rates are yet to develop the expertise for technological innovation, the researchers in this case are at an advantage because their product stands a better chance of being incorporated by laptop makers when compared with similar products being made by companies elsewhere.

Changing Consumer Preferences

This section looks at a key trend related to how consumers are evaluating the different brands and models of laptops according to the changing preferences based on social, cultural and economic factors.

For instance, the trend in recent years has been to discard the desktops in favour of laptops. This has led to a huge boom in the market for laptops which has been exploited successfully by the laptop majors.

However, it is also the case that newer products like Apple’s IPad, Samsung Tablet and other products have titled the scales against laptops. With the arrival of the smaller and sleeker versions with more features and computing power, these products look like they are going to give the laptops a run for their money. In this context, it becomes clear that unless laptop makers innovate and find ways to compete with these products, they are going to see a dip in their sales.

Changes in Technology

The key trends as far as technological changes are concerned would be in the areas related to the entry of cloud computing and ubiquitous computing in a big way in the retail segment. Hitherto, these technologies were limited to corporate and enterprise segments which had the need for large scale computing power and pervasive computing and in the process leveraging the gains from “economies of scale”.

However, in recent years consumers have adopted cloud computing as a means to increase their computing power and the presence of players like Amazon has only added to the competitive nature of the market.

Conclusion

Overall, the scenario that emerges from the analysis is that in a slow growth economy, companies that are agile and nimble and can sense the market trends better than their competitors would succeed.

Given the threat of another recession striking the global economy, companies that concentrate on cost advantage coupled with feature and quality advantages would be better positioned to capture the market as opposed to static companies with limited appeal.

The point here is that whoever provides the best value for money usually corners the market and this is true for all companies and particularly in the case of laptops where the rapid churn in technology means that companies ought to move fast, the introduction of this hybrid chip is sure to shake things up.


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