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Microsoft AI push may boost domestic laptop sales – Crypto News

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Equipped with the capability to independently execute complex AI algorithms, these devices are expected to have a growing impact on overall PC shipments, despite restricted release this year, they added.

According to a consensus of three industry analysts surveyed by Mint, PC shipments are expected to stabilize this year following a 6% dip in 2023. However, rising adoption of AI PCs, tailored to Microsoft’s specifications, could drive a 5% surge in PC shipments, and by up to 15% in revenues by December 2025.

Data from market researcher IDC revealed that as of December 2023, PC shipments, including tablets, stood at 13.9 million units. Laptops dominated PC sales with a 75% share. At an average selling price of $900 (~ ₹75,000), this translated into net revenues exceeding $9.5 billion.

According to estimates, laptop shipments alone could exceed 11.5 million units by December 2025, propelling net revenues to nearly $12 billion, up 26% in just two years.

Analysts attribute much of this projected growth to the introduction of Microsoft’s AI PCs. Branded as ‘Copilot+ PCs,’ these devices will feature a dedicated AI co-processor, or neural processing unit (NPU), enhancing processing capabilities. 

While Microsoft will initially roll out surface-branded laptops, third-party adoption is imminent, considering that industry giants, including Dell, HP, and Lenovo, are poised to launch Copilot+ PCs laptops next month onwards.

AI PCs offer offline support for tasks including file recall, generative image editing, and local search queries. Yusuf Mehdi, Microsoft’s executive vice president and chief marketing officer, stated in a recent blog post that the AI features will “remove previous limitations on things like latency, cost and even privacy to help you be more productive, creative and communicate more effectively”.

However, despite the potential, analysts cautioned that initial adoption may be sluggish due to the higher price point compared to standard laptops. “The new batch of hardware would be more expensive than the average market selling price of laptops in India. This in turn would mean that the uptake could initially be slow, and any major impact in India will likely not be seen at least until next year,” Navkendar Singh, associate vice-president at market researcher IDC India, said, 

“Ultimately, this will definitely have a positive impact, but much extensive efforts will likely be put in marketing activities to explain the benefits of the AI capabilities to users—before the uptake ramps up. Eventually, this will see Microsoft go after Apple’s hardware prowess, especially with the latter’s MacBook Air series of laptops,” he added.

Ultimately, Microsoft aims to challenge Apple’s dominance in the consumer laptop market, particularly its MacBook Air series, which starts at a price of $1,200 in India.

The three industry analysts cited above said that Microsoft is largely focused on Apple’s MacBook Air range—a factor which Nadella has since highlighted through this week in his interviews as well.

In a bid to rival Apple’s M3 processor, which offers 18 trillion operations per second (TOPS) in AI performance, Microsoft stipulates a minimum of 40 TOPS for its Windows-powered AI laptops. 

Analysts expect this distinction, along with Windows’ expansive market reach, to enable brands like Dell, HP, and Lenovo to offer competitive pricing, potentially altering the landscape of consumer laptop preferences.

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Published: 22 May 2024, 09:11 PM IST

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