Everybody Panic: PC processor market will hockey stick straight down until we're all dead


IDC, analysts to the stars, are reporting that worldwide processor shipments are down in the fourth quarter of 2008 17% since the same period last quarter. Overall sales grew by 10% while revenue grew a mere .9%.

”The decline in PC processor unit shipments in the fourth quarter was the worst sequential decline since IDC started tracking processor shipments in 1996,” said Shane Rau, director of Semiconductors: Personal Computing research at IDC. “After hinting at a decline last September, the market fell of a cliff in October and November.”

Fell off a cliff? Thelma and Louise fell off a cliff. This is a downturn.

The report, which basically recaps the old saw that netbooks are driving down processor prices and forcing a race to the bottom in terms of pricing. While this is partially true – people no longer have to buy a powerhouse if they want a second laptop – you’re also forgetting the folks who might have once been rolling in credit are now wary of it and when they see a $399 laptop they figure “Why not?”

Obviously we’re in a pretty bad state but it’s my opinion that the bubble overinflated the perceived sales of PCs and laptops and this correction will basically force companies to retool their product line and move away from encouraging the purchase of $5,000 gaming machines that can crack quantum cryptography just to play Far Cry.