Hardware

Windows 10 dampens sales of new PCs as industry sees historic slump

Analysts say Microsoft's offer of a free upgrade to Windows 10 put off buyers who "might otherwise have shopped for new PCs".

The desktop for an early version of Windows 10.
Image: Nick Heath / ZDNet
Microsoft's offer of a free upgrade to Windows 10 helped depress PC sales towards the end of last year, according to analysts.

The release of Windows 10 in July 2015 was followed by a slump in worldwide shipments of PCs, down 10.6 percent in the final quarter of 2015 compared to the year before. This year-on-year drop, says analyst house IDC, is the largest in history.

Rather than driving sales of PCs, IDC believes that Microsoft's free Windows 10 upgrade for Windows 7 and 8 machines helped persuade PC owners to put off investing in a new machine.

"The free upgrade path to Windows 10 allowed some consumers who might otherwise have shopped for new PCs during the holiday season to obtain a 'new' PC experience," said Linn Huang, research director for devices and displays.

IDC estimates that 71.8 million PCs were shipped during fourth quarter of 2015, closing off a year that saw machine shipments fall to below 300 million for the first time since 2008.

Falling sales can also be attributed to reluctance to upgrade so soon after replacing Windows XP machines in 2014, longer PC lifecycles, competition from mobile phones and tablets, economic issues and social disruptions in Europe, the Middle East, Africa and Asia/Pacific - according to IDC.

Loren Loverde, IDC VP for Worldwide PC Tracker, believes that convertible tablet/PCs and thinner, touchscreen computers will eventually drive consumer sales.

"Most PC users have delayed an upgrade, but can only maintain this for so long before facing security and performance issues," he said. "We continue to believe that a majority of these users will purchase another PC, motivated by new products and attractive pricing."

Shipments of PCs whose keyboards detach to become a tablet, which IDC counts separately from PCs, are growing quickly but from a small base. Adding those units to PC shipments would reduce the year-on-year decline for the final quarter to about five percent.

Loverde forecasts that sales will also pick up as commercial adoption of Windows 10 accelerates during the year.

Not since the release of Windows 7 did a release of Windows coincide with an uptick in PC shipments - according to analyst estimates.

Windows 8 also failed to make any immediate impact on demand for PCs upon its release in 2012, with shipments down 6.4 percent in the final quarter compared to the year before.

In contrast, the release of Windows 7 was followed by a 22.1 percent year-on-year increase in worldwide PC shipments during the fourth quarter of 2009.

However, in general analysts have steered clear of attributing spikes in PC shipments to a new version of Windows so soon after its release. Describing the spurt in machines shipped following Windows 7 release in 2009, Gartner analyst Mikako Kitagawa said "the new operating system launch did not create additional PC demand".

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Nick Heath is chief reporter for TechRepublic. He writes about the technology that IT decision makers need to know about, and the latest happenings in the European tech scene.

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