The Computex trade show used to be a hot ticket, with flashy music acts and technology industry luminaries. Now? Those who show up bemoan the decline of PCs and its many dependents.
Walking the subdued floors found hardware vendors despondent about their chances in a hyper-competitive market and consumers who increasingly favor smartphones instead of PCs. On the trade days, before the show was open to the general public, booth after booth was filled with high-tech gadgets and idle sales staff drinking tea, with virtual reality demonstrations one of the few to draw a crowd.
“This year was the worst,” said Mike Yu of Shenzhen BBen Intelligent Technology Group Co., which makes high-end customized laptops on demand.
It was the countless desktop computers and laptops launched at the Taipei World Trade Center in years past that cemented Computex’s reputation as Asia’s must-see technology event. But with PC sales hitting lows not seen since 2007, and new rival shows more focused on mobile devices, many industry attendees were left questioning its relevance in an age dominated by brands like Apple Inc. that prefer showing new products at its own events.
The Taipei show, which wrapped over the weekend, has also been a showcase for Taiwanese technology companies through brands such as Acer Inc. and Asustek Computer Inc. while also providing a platform for the Microsoft Corp. software and Intel Corp. processors that power their machines.
Global PC shipments declined almost 10 percent in the first quarter, to their lowest since 2007, extending a persistent decline that’s sapping growth at companies from Intel Corp. to Microsoft Corp. and Dell Inc. PC sales have fallen four straight years, forcing industry leaders like HP Inc. and Lenovo Group Ltd. to seek revenue elsewhere, for instance in smartphones and connected home devices.
Image: AP Photo/Chiang Ying-ying
While giants such as Intel and Nvidia Corp. talked up prospects in virtual reality and gaming and visitor numbers have grown, that optimism wasn’t shared by many of the smaller exhibitors at Computex.
The section set aside for tech startups in a separate hall created buzz; the main area for traditional hardware vendors was a lot less lively.
Mike Chow from Precision Squared Technology has been coming to Computex for “many, many years” and he’s never seen it this slow. His company once made a killing by specializing in customized keyboards – an unsexy but vital piece of equipment.
Now business is so bad the company has slowed research and development on new products because would-be game changers like near field communication technology, or NFC, didn’t turn out as planned and smartphones don’t need the products he specialized in.
“It’s become very hard for any manufacturer to predict what will happen,” he said. “All we can try is to launch different combinations of keyboards for different applications. I can see the coming three to four years will also be strange.”
Navin Shenoy, Intel’s corporate vice president and general manager for the Client Computing Group, said making gaming products, 2-in-1 PCs that are laptops capable of working as tablets and internet-of-things devices are key methods for surviving the storm. Nvidia was keen to plug its latest graphics card as the most successful ever.
Manufacturers “that adapt to the realities of the market will do well and that’s no different to the entire history of the PC,” Shenoy said.
For some, survival involves a pivot to new businesses such as video gaming — one of the bright spots for the PC market — with China seen as a massive and lucrative market.
“About 30 percent of our business is in gaming,” said Annie Cheng, senior sales manager at Bloody – the gaming division of A4tech Co. Ltd. “We wish the number was 50-50 because to be honest we have no margins for the 70 percent.”
A4tech got its name from selling handheld scanners so sheets of paper could be uploaded to computers. By 2012 it realized PCs were peaking and Bloody was born.
The gloom over PCs and Computex hasn’t gone unnoticed by the organizers, Taiwan External Trade Development Council. Walter Yeh, executive vice president of the body that runs Computex, says that this was a year of transition away from PCs. Instead, tech startups and companies connecting devices to the internet will have a much bigger focus at 2017’s event – two parts of the show that helped grow visitor numbers.
Computex attracted about 135,000 visitors this year, the organizers said. That compares with about 130,000 in 2015.
“PCs cannot attract visitors and the PC business is already very mature,” Yeh said. “Next year we will focus more on startups and invite more companies to Taiwan.”
This article originally appeared on Bloomberg here.
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This article originally published at Bloomberg here