The Cost of (Good) Laptops is Too Damn High!
As demand for laptops slips, most pundits believe that we're living in a post-PC era where tablets and smartphones will take the place of home computers. According to analyst group NPD, standard notebook sales are down 14 percent year over year, while tablet sales fell at a more reasonable 5 percent worldwide (while growing 1 percent in the U.S.). It's easy to believe that consumers are voting against PCs when they spend so much time with their mobile devices, but the real problem is not that people don't need laptops, but that OEMs offer too little innovation for too much money.
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For many consumers, the PC is now an appliance that's as necessary as a microwave oven, but just as staid. More than 90 percent of U.S. households already own a microwave and most are unlikely to replace it until it breaks, because people just don't see any reason to upgrade to a newer model. PC vendors would like consumers to know that a 2014-era laptop has many features that a 2011-era model does not, but their arguments aren't very convincing ... unless you're willing to spend $1,000 or more.
The average PC laptop selling price has held steady at just below $500, coming in at $484 for April 2014 ($653 when MacBooks are included). For that price, you can get a Core i3 laptop with a 500GB hard drive, 4GB of RAM and possibly a touch screen, but you probably won't get long battery life, a premium design, a crisp display or an SSD. In 2011, for under $500, you could get a Pentium or possibly a Core i3 processor, a 500GB hard drive and 4GB of RAM. Yes, today's Core i3 CPU is a couple of generations better and today we have touch screens, but those don't provide compelling reasons to upgrade. In fact, having to deal with the unfamiliar interface of Windows 8 could be a disincentive.
Tablets, on the other hand, have gotten both cheaper and noticeably better in the past three years. If you bought a slate in 2011, in comparison to today's models, your old single-core or dual-core processor seems slow, your tablet feels bulky and its screen is comparatively dim and fuzzy. With the exception of the Kindle Fire and Nook Color, 2011's best tablets all cost much more than today's average tablet selling price of $325 (April 2014, NPD), down from $382 in April 2013. Today, you can get a tablet with an HD screen, quad-core processor, a much more advanced OS and a lighter, slimmer body for well under $200.
If you want a cheap laptop today, PC vendors have you covered. On the low end of the price spectrum, Chromebooks are compelling to consumers as secondary, student computers because they are inexpensive, lightweight and long-lasting, exactly like the Windows netbooks of 2011. If you want a quality, high-performance laptop, however, you still have to pay $1,000 or more double what the average consumer is willing to spend.
Consumers aren't impressed with benchmark scores, but they notice when they click an icon and their program takes 30 seconds to load. That's why an SSD, rather than a faster processor, would make a real difference for them. Unfortunately, a full six years after Intel introduced the first affordable SSD, you'd be hard-pressed to find a Windows notebook with one for under $900. Several systems have 16GB flash caches that help speed up their hard drives, but they don't help enough.
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Even Bob and Betty Best Buy know a beautiful display when they see one and they've seen one on their tablet and another on their phone. However, at a time when 4.7-inch smartphones have 1920 x 1080 displays and the $379 Kindle Fire HDX 8.9 offers a 2560 x 1600 panel, most laptops are saddled with the same dim, color-challenged 1366 x 768 displays their predecessors had three years ago. If you want a laptop with vibrant color and a high-resolution display, get ready to pay close to $1,000 or more.
You could be computer illiterate and notice when a notebook runs out of juice after just a few hours. However, PC vendors are hoping that you won't notice that, with the exception of Chromebooks, today's average-priced notebooks don't last very long on a charge. In our tests, the average notebook with a starting price under $500 lasted just 4 hours and 54 minutes on a charge which is hardly all day. Meanwhile, the $139 ASUS MeMO Pad HD 7 tablet lasts over 9 hours on a charge, while the iPad mini with Retina display endured for 11 hours and 6 minutes of continuous use.
It's also easy to tell a cheap design from an expensive one. While even inexpensive tablets like the Kindle Fire HDX and Google Nexus 7 have premium aesthetics, the typical sub-$500 notebook is made from shiny plastic, without much in the way of aluminum, magnesium or soft-touch paint. Products like the aluminum iPad Air, the carbon fiber ThinkPad X1 Carbon and the uber-thin Acer Aspire S7 don't come cheap, with the 11-inch Air starting at $899. Across all brands and price points in Q1 2014, sales of ultraslim PCs actually grew 62 percent year over year, so there's still a huge market for lightweight systems, as long as people can afford them.
If you're willing to spend over $1,000 to replace your old laptop, you might see better performance, a more colorful screen and longer battery life, but you won't get much additional functionality. If you buy a PC, you'll get Windows 8.1, a touch screen and, in some cases, the ability to use your laptop as a tablet, but you probably won't get any new software features. OEMs have given up on providing PC software. Most don't even bother to bundle their own webcam software these days, even though the built-in Windows camera app is horrible.
Compare the lack of software innovation on PCs to the massive improvements we've seen on tablets and phones. Today's mobile devices can shoot fantastic images with real-time HDR or erase unwanted photo bombers with the touch of a finger. They can measure your heart rate, log your activity or pay for your groceries with a single tap.
It's no accident that the two laptop vendors who are doing best in this down PC economy are also the pair with the best combination of design and new features: Apple and Lenovo. Lenovo, which makes innovative products like the bendable Yoga series of hybrids and the uber-lightweight ThinkPad X1 Carbon, is now the number one PC vendor worldwide and just saw a 25 percent profit increase in its last quarterly report. Always a premium brand, Apple still attracts a dedicated legion of followers for its MacBooks because of the company's industry-leading design, battery life and gorgeous display panels.
Unfortunately, for most of the laptop industry, the more things change, the more they stay the same. Because vendors are either unable or unwilling to provide a premium, innovative laptop at the $500 price point which has been the average selling price for years most consumers don't see a compelling reason to replace their existing PCs. The problem isn't that we're living in a Post-PC era, but that the cost of good laptops is too damn high.
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