The PC ceiling: December 13, 1999 issue of New Thinking

December 13, 1999 New Thinking:
The PC ceiling

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December 13, 1999

The PC ceiling

By Gerry McGovern

There is a significant percentage of the public out there who have no interest in spending a large amount of money to buy a machine that intimidates them and the majority of whose functions they have absolutely no need for.

The PC Ceiling is already fast approaching in countries such as the United States. It’s not scientific, but I would estimate that some 40 percent of the population will never buy a PC, certainly not the type of PC we have known up until now.

People talk about this great movement towards convergence. Well, the Internet may in fact become this central repository where all the relevant information and interactive environments can be found.

However, the more central the Internet becomes to our lives the more various will become the devices we use to access it. These devices will range from multifunction PCs to devices with single, narrowly defined functions accessing perhaps only one website.

This explosion of Internet access devices is perhaps the single greatest threat to a company such as Microsoft. Did you know that in 2000 there will be more mobile phones sold than the entire install base of computers?

Nokia, the world leader in mobile phones, recently chose the 3Com PalmPilot operating system for its phones. A couple of weeks ago, Sony also chose the 3Com operating system for its own hand-held devices. Not surprisingly, Microsoft was reported to be bitterly disappointed.

The recent Microsoft-Ericsson alliance in this area has been seen by many analysts as reactive. Ericsson’s share of the mobile phone market has declined to 10 percent in comparison to 32 percent for Nokia and 22 percent for Motorolla.

As well, the alliance is only using the Microsoft browser, not the Windows CE operating system. "Microsoft cannot impose its standards on the mobile phone industry because the mobile phone industry is not interested in its operating system," Keith Woolcock, IT analyst at Nomura told CNN.

Nokia, and particularly Sony, have a tremendous understanding of the mass consumer. Herein lies a major threat to the now almost untouchable computer industry.

You see, with the exception of Apple, there is precious little understanding – or even desire to understand – of the mass consumer by this spoiled group. Do you know why we didn't have computers in different colors before now? Because having colors increased inventory costs, and style was for pussies anyhow.

Right now, Silicon Valley rules because the computer industry runs under an essentially ‘make it and they will buy it’ philosophy. The one ‘improvement’ touted for new machines is more speed, but in fact computers are not getting faster because software continues to get fatter.

In the ‘Post-Any-Colour-Once-It’s-Beige’ era, style, reliability, simple functionality and fun will dominate. Soon, the consumer giants of Asia will start grinding out incremental improvements and will send their massive mass marketing machines into big time action. Then Asia will dominate again because Asia understands what the mass consumer wants.

Hitting the PC Ceiling will have all sorts of implications and those who don’t want to have sore heads need to start re-positioning at least some of their offerings very quickly. It’s really a philosophical issue. Those who make washing machines make them to wash clothes for the great unwashed public. Those who make PCs and write code do it to break new ground and solve great problems.

The age of the Internet access device will be very different from the age of the computer. It will be controlled by the consumer giants, not the computer giants.

Gerry McGovern

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In the ‘Post-Any-Colour-Once-It’s-Beige’ era, style, reliability, simple functionality and fun will dominate.