Industry Analysis: Personal Computers

Submitted by Jing-Ling (Genie) Yang

Industrys Primary Focus

Personal Computer industry focus their energy on building computers for a single individuals use

Desktops, laptops, other peripheral devices

The relative new industry :

The term personal computer has been in use for much of the second half of the 20th century, but many of the firms that define this industry have only existed since the 1980s

Faster, smaller, and cheaper

Multi-function computer/ Laptop, device smaller but more powerful

Financial Summary

Sales Volume

In 2007, worldwide sales of the PC are estimated at 62.7 million units in just the 1st quarter

Margin

between 4-5% of total sales as Net Income

Stock Volatility

Seen as a risky investments (Apple $153.54, and HP $49.79)

Size, structure, and composition of the PC Industry

Large industry with strong players

HP, Dell, Acer, Toshiba, Lenovo and Apple

Industry leaders

Organizations - HP and Dell are clearly the largest with market share of 17.4% and 14.4% respectively and each with sales above 50 billion annually. individuals - Michael Dell is famous for Dells direct to client selling strategy and Steve Jobs has surprised the industry by repeatedly showing innovativeness within the industry for future growth

General trends and issues

Strong growth over the past 30 years

Sales volume Technology improvement- computer are more compact and faster over time
Compaq Acquired by HP and Gateway acquired by Acer Global R&D, manufacturing, and sales and marketing teams

Consolidation

Global deployment

Role of IS in the Personal Computer Industry

IS as a Unique position

companies not only use IS within their organizations, but also build and develop IS software for other organizations
Both Apple and IBM pioneered information systems through the early 1980s as new developments in software created a competitive advantage to buy a specific platform.

Role of IS in the Personal Computer Industry

Industry IS leader:

IS as Operation : Dell

The most notable PC company for its use of IS in its direct sales model.

IS as Product / Strategy: Apple

iTunes is a critical use of IS:protect the music industries rights to intellectual capital while locking in users to the iPod product VisiCalc shifted personal computer usage from simply entertainment to vital part of business as a financial tool.

The IS system within the PC maker organizations

ERP system provided by 3rd party vendors

HP, Dell and Apple use such software as SAP, PeopleSoft, Oracle and AIX as well as customized, internal applications.