Wintel dominance seen waning in post-PC era

9/5/2012-by Dylan McGrath

The powerful alliance between Intel Corp. and Microsoft Corp. that has set the pace in the computer market for a generation is beginning to fray amid a new era of computing where new platforms are rising to dominance, according to market research firm IHS iSuppli.

The so-called "Wintel" alliance is expected to suffer a decline in market share in the "new" computer market—a category consisting of not just PCs but also the faster-growing smartphone and media tablet segments, according to IHS.

Microsoft’s share of the operating system market for the three types of products is expected to slip to a combined 33 percent in 2016, down from 44 percent last year, according to IHS. Intel’s share of microprocessors in PCs, smartphones and tablets is expected to slip to 29 percent in 2016, down from 41 percent last year, IHS said.

The total size of the redefined computer market is projected to double from 2011 to 2016, almost entirely due to the strong growth of the smartphone and media tablet segments, according to IHS.

But after years of marching shoulder to shoulder to dominate the PC market with their closely tied operating system and microprocessor technologies, the tables have turned on Wintel, according to Craig Stice, senior principal analyst for compute platforms at IHS. The two companies for years extracted the majority of profits in the PC segment, but sales of smartphones and tablets are now growing at much faster rates, Stice said.

"Wintel finds itself in the unfamiliar position of dancing to someone else’s tune, following standards that were set by other companies for form factors, user interfaces and even pricing," Stice said. "This means Microsoft and Intel must think outside the box—even if it means adopting strategies that work against each other’s interests."