The Always Connected PC will need more than Connectivity to be a Hit

This week, at the Snapdragon Summit, Qualcomm and Microsoft launched their Always Connected PC initiative. This is not the first time we hear about connected PCs. Cellular connectivity has been available on PCs for years, and thus far penetration among consumers has been relatively low. There are of course regional differences in markets like Europe where WiFi connectivity is both hard to come by and expensive. But overall, consumers seem to be happy to use their phone hotspot for those time they really need to be connected.

When it comes to tablets, connectivity has mattered more to consumers especially in those regions where you can either add a tablet to your data plan for as little as $10, or you can have a separate data plan with no contract obligations. iPads have had a reasonably high attach rate of cellular connection with our data showing numbers as high as 49% in the US. Yet, of those devices only 45% have an active data plan associated with them. The most significant driver (52%) for these consumers is the peace of mind of always having connectivity just in case they need it. And peace of mind as well as convenience are always big drivers!

With the holiday shopping in full swing, PCs vendors are looking for ways to entice consumers to spend their holiday budget on a new PC. Intel has been showing you how all the new technologies like 4K gaming and video, as well as VR will not be available to you unless you invest in a new PC. And soon Microsoft, Qualcomm, and their partners will be busy talking about the joys of the Always Connected PC.

The Always Connected tagline is not limited to cellular connectivity. It also speaks to a PC that has instant-on and a long battery life. It promises to deliver a computing experience that will come with you wherever you are and that will free you from looking for a power source, being dependent on free unsecured Wi-Fi or jumping through hoops to connect to your phone. While somewhat reliant on what kind of offers we will see from carriers who would not want to be free to work or play anytime anywhere? This will be particularly true if devices start shipping with a free connection trial so users will get hooked on that convenience and peace of mind

Apps & Services drive the Need for Connectivity

If you have seen the latest iPad commercial and can relate to it, you might have already bought into the promise of an always connected computing experience. It is ironic that Apple is helping sell the vision that Microsoft, Qualcomm and their partners want to deliver. Except, of course, Apple is also telling you that your always connected life does not require a PC.

And here is the heart of the matter. For consumers, the desire to be connected has little to do with being productive and a lot to do with getting “stuff” done whenever we want. That stuff can range from streaming music, to upload to social media, to playing online games, to shopping online…. basically being able to do the same things we do on our smartphones but with the advantage of having a larger screen and a keyboard. Forty-three percent of the consumers we interviewed who have a connected iPad said they do a little bit of everything. This does not mean we will carry our smartphones less or rely on them any less. It simply means we will have the option to choose the best tool for the job without having to compromise on connectivity and battery life.

While connectivity and battery life will no longer be in question, the Always Connected PC must deliver on the variety of apps and services we can access with it. This will require a stronger investment in the Windows App Store than what we have seen so far from Microsoft, especially as they try to position Windows 10 S – which is fully reliant on store apps – as the most modern computing experience.

The Windows App Store was the weakest link for Windows Mobile, and it cannot be the weakest link for the Always Connected PC, or for Windows 10 S, for that matter. It would be a terrible mistake to think that being able to be connected only for productivity reasons will be enough of a drive to see consumers flock to stores and buy these devices. I am sure both OEMs and carriers have learned a lot from the netbook experiment. Not just in terms of design and marketing but also in terms of the value proposition that consumers must see in a device.

An Opportunity for Phone Manufacturers to Broaden their Scope

Traditional PC manufacturers are continuing to look for new drivers to fuel sales and Always Connected PCs is just another way to get consumers’ attention. Yet, some might be a little shy in investing too much in this segment seen how the netbook and Windows RT experiments ended. At the Snapdragon Summit we saw devices from Asus and HP and Lenovo was mentioned as having a device in time for CES. The challenge for pure PC manufacturer rests on the balance of supporting all connected PCs, Intel as well as Qualcomm based ones, as well as to help consumers decide between their full product portfolios.

Given Always Connected PCs will speak more to highly mobile users, I see a great opportunity for phone manufacturers such as Samsung and Huawei to invest in these devices to widen their reach. They have the relationship with the carriers and with Qualcomm as well as their own semiconductor capabilities. Plus they do not have to figure out where to place these products within a wider PC offering. Samsung, in particular, with its trusted Galaxy brand, might be seen by many consumers as a natural choice for an Always Connected PC.

Samsung has played in the PC space at a world-wide level with few devices but has not really put much marketing push behind its effort. This initiative might indeed offer a good opportunity to try a more aggressive approach without having to commit to becoming an all around PC vendor. Samsung could, of course, consider the enterprise market as well as its ambitions of delivering Knox as a full-fledged platform strengthen. Yet, this road will require a tighter collaboration with Microsoft than we have seen thus far.

Consumers will not care about who empowers their Connectivity

Connectivity must come with the right design, the right marketing and most of all at the right price point. What the right price point will be is heavily dependent on the value buyers will see in the experience that is delivered to them. What will not matter to consumers is how the connectivity is delivered and we already know that while the Always Connected PC effort is now driven by Microsoft and Qualcomm, Intel will be jumping on the bandwagon too while trying to position their solution as superior.

What will ultimately matter to consumers when choosing the solution remains to be seen. Will consumer trust Qualcomm, who is responsible for their everyday connectivity on their phones? Or will consumers be looking for an Intel Inside logo as they always do when they buy a new PC? Hard to say at this point, but two things are clear: Microsoft and Qualcomm must invest in building a differentiated value proposition and they must help consumer understand what it is they are buying into.

The value proposition of Always Connected PCs might  revolve around positioning these devices closer to a smartphone than a traditional PC. The freedom of a phone experience when it comes to things to do, battery, ease of connectivity, coupled with a bigger screen, a modern PC OS and a highly mobile form factor is what consumers are looking for. A solution that if implemented right, might even have Windows users question what a PC really is, as they embrace a modern computing experience.

Published by

Carolina Milanesi

Carolina is a Principal Analyst at Creative Strategies, Inc, a market intelligence and strategy consulting firm based in Silicon Valley and recognized as one of the premier sources of quantitative and qualitative research and insights in tech. At Creative Strategies, Carolina focuses on consumer tech across the board. From hardware to services, she analyzes today to help predict and shape tomorrow. In her prior role as Chief of Research at Kantar Worldpanel ComTech, she drove thought leadership research by marrying her deep understanding of global market dynamics with the wealth of data coming from ComTech’s longitudinal studies on smartphones and tablets. Prior to her ComTech role, Carolina spent 14 years at Gartner, most recently as their Consumer Devices Research VP and Agenda Manager. In this role, she led the forecast and market share teams on smartphones, tablets, and PCs. She spent most of her time advising clients from VC firms, to technology providers, to traditional enterprise clients. Carolina is often quoted as an industry expert and commentator in publications such as The Financial Times, Bloomberg, The New York Times and The Wall Street Journal. She regularly appears on BBC, Bloomberg TV, Fox, NBC News and other networks. Her Twitter account was recently listed in the “101 accounts to follow to make Twitter more interesting” by Wired Italy.

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