Business Trends in the Computer Industry
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- For the next few years, the pace of Asian economic recovery will remain sluggish. If the US market remains strong, Asian computer manufacturers will continue to flood the American market with their products. Equipment prices will continue to drop (precipitously in some cases). Increasingly desperate manufacturers will accelerate market competition and continue to drive prices down. However, as the Asian economies recover from recession we can expect the hardware price wars to abate.
- The US computer industry is an amalgam of both old and new markets. We can expect to see intense competition in the new and emerging markets and monopolies established in older, more established market segments (e.g. Microsoft’s operations system business).
- Expect increased consolidation in both the computer hardware and software industries. Continued consolidation among computer manufacturers will lead to increased reliance on branding to differentiate their products from those of their competitors. Fewer and fewer manufacturers will control very large uncontested segments of the market. We can expect to see intense competition among the surviving companies for the small portions of market share that remain “in play”.
- Hardware and software manufacturers will invent new strategies to sell and distribute their products. We can expect to see free hardware give-ways, rented software, open source freeware, traditional licensing of shrink wrapped software, web-based (push or pull) distribution as well as traditional retail distribution.
- If one were to use the past 50 or 60 years is an indicator of technical trends, it’s fair to expect that in 10 years, today’s most expensive, state-of-the-art technology (i.e. military technology) will find widespread commercial acceptance and fall to approximately 1/10th of its current cost. Examples of this phenomenon include the microwave phone system, mainframe computers, the integrated circuit, mobile networking and the internet.
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