Best of luck Microsoft, but the Surface Book isn't going to save the PC

Microsoft has unveiled the pinnacle of laptop design as the format faces a terminal, and possibly unstoppable, decline

                          

Three things happened in the space of two days last week that explain perfectly the state of the market for personal computers.

On Wednesday morning, at a glamorous Apple-style event in New York,Microsoft unveiled its first laptop, a breathtaking combination of design and function called the Surface Book that the company, without a hint of humility, dubbed “the fastest laptop on any planet”.

Then just a few hours later, it emerged that Dell, a computer hardware giant with its better days behind it, was in talks with data storage company EMC over a $60bn deal that would be the biggest technology takeover in history.

And finally on Thursday, IDC, a research company that tracks worldwide sales of tech products, said that sales of PCs in the third quarter of the year had fallen 10.8pc against the same quarter a year ago, a much worse decline than expected.

To understand these events, it is best to look at them in reverse-chronological order. First, the IDC figures. Sales of PCs – laptops and desktop computers combined – have been on a downward trend since 2012 after a decade of unbroken growth, and now sit at roughly 2007 levels.

Reasons for this include stretched corporate IT budgets, diminishing returns from upgrades and Microsoft’s lacklustre software releases, but the main factor has been the rise of mobile. Touchscreen smartphones and tablets have redefined personal technology, combining the internet with portability and ease-of-use to become the dominant platform.

This brings us to Dell. Once the world’s biggest PC manufacturer, whose low-cost manufacturing and fashionable designs allowed it to disrupt lumbering giants such as Compaq in the 1990s, it has suffered more than most from the decline of the industry. In 2013, its founder, Michael Dell,took it into private ownership, saying a radical strategy to turn it from a hardware company into an enterprise-focused services group would be easier out of the public glare.

Buying EMC, a move that reports suggest could be announced this week, is the clearest manifestation of this. “Selling PCs isn’t working for us, we need to try something else,” the company is saying.

Similar things are happening at HP, which is splitting into two next month to free its growing data and infrastructure unit from its declining hardware operation, and Lenovo, which bought Motorola’s mobile business from Google last year. In other words, the world’s PC manufacturers are getting ready for the demise of the PC.