Moves by HP, Google further marginalize the traditional PC

SAN FRANCISCO -- Steve Jobs' bombshell resignation as CEO. Hewlett-Packard's abdication of its multibillion-dollar PC group. Google's $12.5 billion purchase of Motorola Mobility. Dell's wobbly sales forecast.

The whipsaw sequence of recent events in the technology industry highlighted what many are calling the rise of mobility and the marginalization of the PC. Meteoric spikes in the sale of smartphones and tablets are merely hastening the diminished status of the traditional desktop PC, whose sales have flattened the past few years with little relief in sight.

The shift from PCs to mobile devices and so-called cloud-based computing has sent ripples throughout the high-tech industry, uprooting HP's business strategy and propelling a Google wireless partnership that seemed unthinkable weeks ago.

Google Chairman Eric Schmidt put it bluntly last week at a cloud conference here: He said tech had exhausted the limits of the PC as a platform, and the future would center on mobile devices.

"The PC market has become commoditized," says Forrester Research analyst Sarah Rotman Epps. "It's a highly competitive business, though PC sales continue to grow."

Absent Jobs' daily wizardry and exacting standards, many now openly question whether even Apple can maintain its innovative ways and marketing guile several years from now, further jeopardizing its own PC sales and inflicting more damage on an-already reeling PC industry.

"Jobs' charisma and marketing skills — not just his tech vision — helped Apple sell products to consumers," says Yan Anthea Zhang, professor of strategic management at Rice University's Jones Graduate School of Business. "With him off-stage, competitors have a chance to catch up to Apple's dominance in the smartphone and tablet markets, in particular."

PC's waning dominance

Certainly the PC isn't necessarily going the way of the dinosaur, pay phones and space shuttle missions. But "personal computer" isn't necessarily the first thing most people think of when they talk computers. For many, it's iPhone, Android phone, iPad, Kindle — even BlackBerry.

"When I helped design the PC, I didn't think I'd live long enough to witness its decline," Mark Dean, an IBM veteran who helped build the first PC 30 years ago, recently wrote on his blog. "But, while PCs will continue to be much-used devices, they're no longer at the leading edge of computing."

"The social revolution is driving a paradigm shift in hardware and software, says Salesforce.com CEO Marc Benioff, who has predicted the end of the PC for years. "HP was the first to go, and others will if they don't keep up" with changes.

The rise of software and cloud computing have paralleled the waning dominance of the PC and contributed mightily to its current state, say venture capitalists and tech executives. Kids, in particular, are eschewing desktop PCs and laptops for smartphones and iPads to play games, use e-mail and perform other tasks that do not require large screens.

"The PC device has evolved in terms of size, shape, use and ubiquity," says Pat Richards, a former IBM executive who is now chief technology officer of SCIenergy, an energy-management software company. "There is no doubt software and apps are a huge part of that" by letting consumers perform computing tasks everywhere at any time.