Post-PC Era?

Several great business luminaries and prognosticators (Steve Jobs is only the latest one) have been speaking of the post-PC era since at least 2004. This is supposed to be the time when the personal computer is a largely stable and mostly replacement-oriented market. There are no new major categories (desktops, laptops, servers) or significant innovations that disrupt these markets and industries.

Applications are entrenched into our worklife and bloated with feature-creep. My 80-year old mother needed word to read her grandchildren’s school projects. Who can imagine not working with PowerPoint?

The input devices, namely the mouse and [[QWERTY]] keyboard haven’t changed all that much in a decade. The once-great enabler companies – Intel, Microsoft, HP – are managed like electrical or gas utilities and railroads, much to the chagrin of their long-standing shareholders. As a utility (not growth) company, they generate enormous cash from operations, and the shareholders have become the widows and orphans, formerly shareholders of the telephone company.

vcITinvestments95-09Despite the apparent doom and gloom of this picture so far, the post-PC era isn’t all bad – its just a different stage in the industry lifecycle. We’ve progressed beyond growth into a plateau of stability. The real characteristics of the post-PC era denotes saturation of the market, the supremacy of the channel and a general lack of high return (compared to the hey-days of the industry) on a shareholder’s investment in the space.

Here’s a snapshot of the National Venture Capital Associations annual summary of deals for computers and peripherals, IT services, networking and equipment and software industries indicated in maroon. Telecom mirrors the profile with the light blue bars. Note that this graphic doesn’t show return, only investment which indicates some sense of the exuberance that was 1999-2000. Obviously, 2000 was one incredible year to be a startup, but despite the $45 B that went into the sector, investors may not have gotten all that much out of the sector. In more recent years, we see a more stable figure of $7-$9 B. The drop to $5B in 2009 had to be due to the tightness of the economy in general causing many funds to scale back their investment plans.

What Era are we really in?

Steve Jobs uses this language to position his PC company (Apple) as a leader. The point of calling this the post-PC era is highlight how things are different than the PC era where Microsoft is the leader and to position them as old and in decline. I’d rather not consider it that way. Instead, I would argue that we are in a state of mobile computing, where the smartphone in your pocket really drives your work life. The laptop wasn’t really about mobile computing. The laptop delivers a state of portable computing. You can’t walk and check your email on the laptop. You can walk and check the email on the smartphone, ergo mobile > portable.

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