PCs Aren't Dying. They're Just Way Overpriced.

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The PC industry is hitting the panic button after a recent report from market analysis firm Canalys stated that worldwide computer shipments were down 13 percent in the first quarter of this year compared with the same time last year, and are at their lowest since mid-2011.

Taken out of context, reports like this are not just frightening, but dangerous: They give both consumers and corporate decision makers the false impression that we're living in a "post-PC" era where computers are now obsolete.

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In reality, however, computer sales numbers aren't as bad as this report makes them out to be. In fact, the low-cost-laptop segment is actually growing. People still love their computers, but they aren't replacing them as frequently as investors would like, because the cost of truly gaming-changing laptops is still too damn high. My unsolicited advice to manufacturers: Cut your prices, and make upgrade-worthy features standard on every laptop over $300.

According to NPD, another company that tracks PC industry trends, U.S. retail consumer PC sales were down only 5 percent (in units, 6 percent in dollars) in the first quarter. And among laptops, specifically, sales of sub-$300 systems grew by a healthy 19 percent and had the largest overall sales volume. Sales of premium laptops with prices over $700 shrank by a modest 4 percent, but sales of midrange laptops with prices between $300 and $700 fell by a remarkable 19 percent. When you break out laptop sales by platform, Windows laptop sales as a whole shrank a lot less (2 percent) than Chromebook or MacBook sales (5 percent and 7 percent, respectively).

Laptop Sales Growth

It's no surprise that inexpensive laptops, especially cheap Windows laptops, are doing so well. For under $200, and sometimes as low as $150 on sale, you can get something like the Lenovo Ideapad 100S, which weighs just over 2 pounds, lasts nearly 10 hours on a charge and runs Windows 10 well enough for web surfing and light Microsoft Office work. At those prices, it's easy to justify purchasing a secondary or kid's laptop.

MORE: Splurge or Purge: What Laptop Features Are Worth the Money?

For those who can afford to spend over $700, today's premium laptops make a lot of sense. You can get incredibly thin and light laptops with long battery life, vibrant displays and cutting-edge performance. However, the average PC laptop price is under $500 and has been for several years now. Few consumers can afford to replace their older laptops with new units that cost this much.

Every laptop over $300 should have a 1920 x 1080 screen and a solid-state drive.

The reason midrange laptops are doing so poorly is that most of them aren't appreciably better than the old models they're meant to replace. Four or five years ago, a typical midrange laptop had an Intel Core i3 (or maybe Core i5) CPU, 4GB of RAM, a 500GB hard drive and a 1366 x 768 screen. Today, most laptops in that price range still have awful, low-res screens, though now some have touch capability.

Sub $700 Laptop Today and in 2012

Most midrange laptops still have mechanical hard drives and Intel Core i3 or i5 CPUs that are faster than their predecessors', but not so much faster that they dramatically improve the web surfing or Office productivity experience. Many midrange laptops are still quite bulky and made from cheap plastic, rather than aluminum, magnesium or carbon fiber.

Even the most tech-illiterate consumer can appreciate a sharper display with 33 percent more screen real estate.

However, the good news is that, if you do your research, you can find a laptop with some premium features for well under $700. For example, Asus' VivoBook E403SA retails for $399 but comes with a 1080p display, over 9 hours of battery life, USB Type-C charging and a 128GB solid-state drive. Or, for just over $600, the Lenovo ThinkPad 13 gives you a durable aluminum chassis, a full-HD screen, an SSD, over 9 hours of endurance and the best laptop keyboard I've ever used. Neither of these systems has a particularly fast processor, an extremely vibrant screen or the fastest SSD around, but at least you get those basic features.

For a midrange price, you can also get a decent 2-in-1 that converts from a laptop into a tablet, and though it probably won't have the best performance or sharpest screen, it will provide functionality that you didn't have on your old systems. In its otherwise grim report, Canalys points to convertibles as a bright spot, writing that "shipments of two-in-ones and detachable tablets are expected to continue to do well in the U.S. and will grow in high income markets."

However, the VivoBook E403SA and the ThinkPad 13 show that laptop makers don't have to charge over $700 to offer upgrade-worthy features. Every laptop over $300 should have a 1920 x 1080 (or higher-resolution) screen and a solid-state drive, neither of which was available on midrange laptops a few years ago. While not absolutely necessary, USB Type-C charging should also be part of this standard package, because it prepares users for the next generation of universal docks and peripherals.

Even the most tech-illiterate consumer can appreciate a sharper display with 33 percent more screen real estate for multitasking. The craptastic-but-commonplace 1366 x 768 display should have joined floppy drives and parallel ports in the dustbin of history years ago.

MORE: Why 78 Percent of Laptop Screens Suck

There's also little excuse for selling any laptop with a mechanical hard drive in 2016. A laptop's storage drive, not its processor, has the most influence on real-world performance. A decent SSD can boot Windows 10 in under 20 seconds and open most mainstream applications in under 3 seconds, or often within a second. Users will definitely notice the difference when they're able to start browsing the web right away, rather than twiddling their fingers while staring at a spinning circle. If I can buy a 128GB SSD for less than $40 online, manufacturers that purchase in bulk can afford to add it to their laptops.

Simply telling people that they can now get a 6th-gen Core i5 to replace their 2nd-gen Core i5 is not going to cut it.

Perhaps manufacturers don't want to bring upgrade-worthy technologies to their midrange laptops because they want to convince users to buy more products that cost over $700. According to Stephen Baker, NPD's lead consumer hardware analyst, original equipment manufacturers (OEMs) need to keep their margins high.

"There are extra costs in premium products around build, design and inventory, so the OEMs need to make more money to cover those," Baker told us. "Reducing prices at premium levels is unlikely to generate enough incremental new sales or trade-ups into those products to offset the lost margin dollars absorbed in cutting prices."

However, if manufacturers really want to sell more laptops, they need to provide better incentives for consumers to upgrade their old systems. Simply telling people that they can now get a 6th-generation Core i5 CPU to replace their 2nd-generation Core i5 CPU is not going to cut it. Making 1080p screens, SSDs and USB Type-C standard features would provide that incentive, without obviating the need for higher-end laptops with better build quality, screen vibrancy and performance. 

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Author Bio
Avram Piltch
Avram Piltch, LAPTOP Online Editorial Director
The official Geeks Geek, as his weekly column is titled, Avram Piltch has guided the editorial and production of Laptopmag.com since 2007. With his technical knowledge and passion for testing, Avram programmed several of LAPTOP's real-world benchmarks, including the LAPTOP Battery Test. He holds a master’s degree in English from NYU.
Avram Piltch, LAPTOP Online Editorial Director on
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21 comments
  • John IL Says:

    Then you have this obsession with cheap slow 32 Gb storage netbooks trying to run Windows 10 on such crappy specs. Just to compete with Chromebooks that actually run well on that cheap hardware. Why you ask? That's a great question because users are generally disappointed and give awful reviews. Even the new Surface Go is pretty and has a great screen a plus for a cheaper tablet/notebook. But add in a type cover and you have a slow Pentium with only 64Gb storage and 4Gb RAM. Perfect for Chrome OS, not so much for Windows 10.

  • Magnus Says:

    Still true. I've long since given up on laptops (last one not only had the HDD fail at 1.4 years, but Acer also discontinued the AC and battery at 2 years; you know, when you'd typical replace the battery). Every one I've seen in the last five years looks flimsier, thinner (hotter) than ever... no thanks. I've been back to desktop since 2014, happily. Except for the fact that it now demands at least $800 for a barebones, low-end tower today (whereas in the wee 2000's a mere $500 would net you a respectable gaming rig). RAM and GPU are absolutely ridiculous right now. And Intel's been ridiculous since 2004 (AMD FX-8320 since 2014 and I have no regrets), you know since they broke antitrust with OEM's (mostly Dell though) and put AMD into the black and generally screwed us all over. Frankly, in excess of $250/part is disgusting. Well in excess of $300 is abominable.

    And really sharpen up now: mobile toys will not fully displace a desktop within our lifetimes, if in fact ever. They are not conductive to productivity, nor can they handle and nor even should they try to serve in some tasks (e.g. CAD)... and gaming (that laptop of mine actually could game, specifications were up to par on paper, but the heat about killed it. Useless).

    I've been wanting to upgrade my desktop now for the last year and a half (primarily for M.2 and generally future-proofing) but I can't, won't really, until DDR4 and GPU's come back down to REASONABLE cost. And for crying out loud, can we PLEASE be rid of the RGB fad on hardware (surely that should knock off $20)?

  • Get Android Says:

    The price of donuts every year is actually skyrocketing vs any PC I have ever owned so I don't know man I just don't know.

  • Filip S Says:

    Yea and bad Euro makes it REALLY evil for Europe... I bought in "last second" in 2014 and companies waited for over a year until they finally started to change the exchange rate more to the 1 to 1.05 and not anymore the old 1.35+ (if not around 1.50, in summer 2008 when Oil Price hit all-time nominal records we had over 1.55, so the oil was not that much expensive in Europe,

    but its 25% or less of the oil price in our gasoline prices unlike the US... only reduction of VAT since the product is cheaper supports that 25% a bit....

    same with PC's... I checked, I would get a little bit better desktop pc CPU, I got already a 120GB Kingston SSD, 2 x 4 GB-1600 RAM, 1 TB HDD, Special Gaming Asus OC GTX 760 (2GB Graphic Space, 256 Bit) and a FX-8320... now I could get for this price a FX-8320E (only the criminal high energy demand of the FX-Series was corrected there, and maybe 1-2 features I dunno anyway were added for the "E" versions, makes my FX-8320 from a 125W TDP a 75W 8320... Graphic... GTX 1060 Gaming with 4GB or with a small extra fee a 8GB, we need AMD back, AMD in my old desktop my mom now uses (i3-540, I bought it because the AMD had too high power consumption, and this was very smart since my mother uses it, the 20 euro gave me a little bit better performance than the AMD-CPU which was in the package "recommended" and a much lower maximum power demand and if the CPU is running with 40 or 60% the demand is muuuch lower too, I don't know how many kWh this saved me, here I do not pay the electricity,

    We have Intel CPU's which came in late 2014 for 330€ release and do now cost 350€! Normally after 2 years for 20€ more you got the next generation CPU and not the exact same one which released cheaper 2 years ago....

    Nvidia has ~88% market share, and AMD showed a graphic with the "500"-gen, they compare only with their cards except for FPS in a few games, and in the cheapest model they compare it with a R7 380X or so... this is not even the most actual afaik, so they compare their new card with a card from 2 generations earlier and even than the more in "Performance" is not overwhelming, in 2016 in Forums people had the hope that Polaris brings AMD back, but if they do not bring fast a 600 series, maybe this time some dollars more per card but more PERFORMANCE, if not they are soon away and only remain in on-board graphic solutions and will battle in smartphones, but there is still a very large market in desktop pc, so why do they not invest for research&develop? The card my mother has (HD 5770, last "ATI Radeon" generation in its name, and I think in this generation they started to lose Nivida slowly with every new generation a bit more... and Nvidia is taking prices, they will have very heavy less sales or already had in 2016 and 2017 so far, because people like me can not afford over 50% of the budget which always was enough for the GPU only... GPU + CPU and the old budget is away.... so I will not buy and I think that many people can not soo easy afford a 1200 euro system which you used to get for ~700 to 800 euro usually...they wait or stop buying gaming desktops and go to playstation, xbox or so....

  • Brandon Lopez Says:

    I guess the only pc that is truly overpriced would be apple based pc's as the cost of your average microsoft based pc is $799 with substantial performance and last atleast 5 years tops well your average mac will cost you $1900 with incredibly low performance and generally last 2 years at most

  • Brandon Lopez Says:

    I guess the only pc that is truly overpriced would be apple based pc's as the cost of your average microsoft based pc is $799 with substantial performance and last atleast 5 years tops well your average mac will cost you $1900 with incredibly low performance and generally last 2 years at most

  • John S Says:

    The problems with PC sales are two fold. One is the lack of noticeable improvements in hardware, and two the lack of disposable income for PC's today considering what other technology people are spending money on. Buying a smartphone every two years also seems rather ridiculous considering their price. Should you have to spend $600 plus for a smartphone every two years? At one point PC makers convinced buyers of this plan, replace every three and see a difference in speed, battery life and features. Now that's just not the case and I suspect smartphones will begin to slow too as consumers realize the improvements are not worthy of the costs.

  • Philippe Symons Says:

    While these are valid points, I miss the most important one to me: The Intel U processors are a scam.

    A month ago, I was looking to buy a new laptop, because my old ASUS K53SV's mainboard was broken.

    But looking at the specs of new laptops, I was severely disappointed: most laptops now contain an Intel processor from the U (low power) line. While this extends the battery life, it has other implications: core i7 models are no longer quadcore with hyperthreading as you'd expect (this was the case 5 years ago), but on the U models, they are dualcore processors with hyperthreading.

    Imagine my surprise when I discovered -by looking at some benchmarks- that laptops, which are sold for €800 today, are getting their butt kicked by my 5 year old ASUS laptop with Intel core i7 2630QM (which I bought for around €800 back then).

    To get a processor which is actually better than my old laptop's processor, I'd have to spend >€1100.

    Eventually, I just ordered a refurbished laptop motherboard for my old ASUS K53SV and just repaired it. It works perfectly by the way.

  • Jonathan Says:

    The average profit per unit is under $15 so its no wonder, really. I think it could be helped if VAT was lower but then a laptop is considered a luxury so I doubt they would do that.

    You can get decent specs for low range laptops from China. They usually come with a bit more specs for your money such as 4gb RAM instead of 2 in the West or 64gb EMMC instead of 32.

    I am not surprised about mid range being cut down. They are a little too powerful to be "good enough" and at the same time far too weak to be a gaming laptop. Speaking of which gaming laptops are far too expensive. I think a lot of gamers consider getting one but its more than a car and maybe 4 months worth of rent just for a decent one.

  • Adnan B. Says:

    To be honest, people who think like me consider a laptop a more permanent investment than something you can carry around in your pocket, hence, I also expect the laptop to be treated in that respect, 4 year old laptops are in no way old and can run any program (provided it doesn't overstrain the components) you throw at it, I am immensely saddened too that the laptop which I use hardly has any more hardware support, I love my laptop but the scarcity of hardware replacements is something that hit me hard.

  • Dkdkwjd Says:

    It's the Apple effect. Others see consumers are happy to spend over 1k for basic apple computer, so they want a slice too.

  • RedLeader Says:

    The improvement from 1366x768 is not 33%, it's 97%.

    2073600 pixels (1080p)
    - 1049088 pixels (1366x768)
    = 1,024,512 pixels (the improvement)

    1,024,512 pixels (improvement) div by 1,049,088 pixels (1366x768) = 97.7% gain.

  • Donny Stanley Says:

    I wholeheartedly disagree with the notion that laptops, or PCs in general are overpriced. You can make a nice graphic comparing the "typical sub $700 laptop" from 2012 and today, but that doesn't mean its true.

    If you look on Amazon, for example. The specifications which you list for a typical sub-$700 notebook is more of what you'll find for under $400.

    http://www.amazon.com/Asus-F555LA-AB31-15-6-Inch-i3-5010U-Processor/dp/B011KFQASE/ref=vsbg_lptp_601434_sr/182-1650431-7186737?s=pc&ie=UTF8&qid=1463999101&sr=1-1

    http://www.amazon.com/Lenovo-17-3-Inch-Laptop-Processor-Windows/dp/B01CKA5CY6/ref=vsbg_lptp_601434_sr/177-0728782-7275747?s=pc&ie=UTF8&qid=1463999132&sr=1-12

    http://www.amazon.com/Dell-Inspiron-15-6-Inch-Touchscreen-i3-5005U/dp/B00ZOO1RFO/ref=vsbg_lptp_601434_sr/177-0728782-7275747?s=pc&ie=UTF8&qid=1463999132&sr=1-13

    Now, for under $600

    http://www.amazon.com/HP-15-ay011nr-Full-HD-Generation-Windows/dp/B01CGGOZOM/ref=vsbg_lptp_601434_sr/176-5987097-1704000?s=pc&ie=UTF8&qid=1463998813&sr=1-1

    http://www.amazon.com/Acer-Aspire-V3-372T-5051-13-3-inch-Notebook/dp/B01682HZAQ/ref=sr_1_21?s=pc&ie=UTF8&qid=1463999370&sr=1-21&refinements=p_n_operating_system_browse-bin%3A12035945011%7C12566246011%7C5945862011%7C5945861011%7C2232492011%7C562222011%7C2232496011%7C2232493011%7C2232495011%7C2232494011%7C5945864011%2Cp_n_feature_four_browse-bin%3A2289793011%2Cp_n_feature_three_browse-bin%3A9647486011

    http://www.amazon.com/Lenovo-15-6-Inch-Touchscreen-Windows-80R40008US/dp/B014MIBRCU/ref=sr_1_22?s=pc&ie=UTF8&qid=1463999370&sr=1-22&refinements=p_n_operating_system_browse-bin%3A12035945011%7C12566246011%7C5945862011%7C5945861011%7C2232492011%7C562222011%7C2232496011%7C2232493011%7C2232495011%7C2232494011%7C5945864011%2Cp_n_feature_four_browse-bin%3A2289793011%2Cp_n_feature_three_browse-bin%3A9647486011

    http://www.amazon.com/Acer-E5-573G-15-6-Inch-GeForce-Windows/dp/B012IBOCRU/ref=sr_1_16?s=pc&ie=UTF8&qid=1463999370&sr=1-16&refinements=p_n_operating_system_browse-bin%3A12035945011%7C12566246011%7C5945862011%7C5945861011%7C2232492011%7C562222011%7C2232496011%7C2232493011%7C2232495011%7C2232494011%7C5945864011%2Cp_n_feature_four_browse-bin%3A2289793011%2Cp_n_feature_three_browse-bin%3A9647486011

  • Human Overpopulation Says:

    Human Overpopulation leads to commoditization of goods beyond the staples barrier. But the sociopathic and autistics masons growthers did not have enough iq to understand the evil effects of human overpopulation, let alone the effects on their pockets. You think that data is bad, wait, youll see xD.

  • JuanSoto Says:

    eMMC storage topping off at 32gb, 2gb RAM, glossy fingerprint magnets, TV-style 16:9 screens and OSes designed to spy on you and share that data with untold, unknown 3rd-parties.

    Not much to be excited about.

    Solution: I picked up an older laptop, 500gb, cd-writer, bright matte screen... most importantly, it's running Linux - on OS that respects it's users.

  • Zach Zach Says:

    I have a old 14" Lenovo T420 from 2011 with an Intel Core i5 2520M and it was selling for about $1,100. Using Passmark, it benchmarks at about 3558. A while back I added 16GB of ram and a solid state drive for about $150 more. It was selling on Amazon used for about $200 last year.

    A new 14" Lenovo x260 in 2016 with a i7-6600U benchmarks at 4,303 and cost about $1,100. That does not include a solid state drive and only comes with 4GB of ram.

    WTF? What happened to Moore's law? How can a laptop from 2011 even be comparable to one from 2016?

  • Joe Says:

    For $500 I would stay far away from an Intel powered I3 laptop. With an AMD laptop you generally get a decently powered, quad-core APU that will allow your computer to actually function if you introduce it to a game or other graphics heavy program. That said, I have an I7 laptop (with a dedicated NVIDIA graphics card) that I bought for just over $500USD when the gen switched from 3 to 4.

  • ChromeShine Says:

    Looks like the Toshiba 13.3" Chromebook and the ASUS Chromebox are both great values. Inexpensive meets fast and simple - just what people wanted all along. Simple as a toaster to operate .... an analog toaster, that is ;)

  • James Says:

    I couldn't agree more. My partner and I are getting ready to move from New Zealand back to Europe and so I'm selling my custom built desktop and looking to buy a couple of laptops.

    I'm willing to spend a little more that 500 USD but even at the prices I'm looking at I can't really see anything compelling. Everytime I think I've found a decent machine it falls down on one major hurdle. Either price, no SSD, battery life or weight. I definitely feel I'm spending enough to have those basic features and some build quality to boot!

  • Sam Says:

    Tablets are disposable, 2 years usage tops.

    A laptop will have at least 5 years usage. Also a laptop will equip you with skills to get a real job.

    A tablet will equip you with skills to take orders at Starbucks.

  • John Ireland Says:

    Really not a great analysis. The whole argument rests on buying the current generation only. I purchased a third generation ultrabook for under $400 when the fourth generation launched. The ultrabook I got had a high quality touch IPS screen, upgraded Core i5, 6 GB RAM, hybrid SSD/HDD and USB3. Like everything, it is about shopping the deals... Oh yeah and this one gets twice the battery life of a 2011 model and can play way better games

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