AI PCs: 'Something Will Have To Give In 2025, And I Think It's Pricing'

The premium price of AI PCs and a lack of killer applications are leading to some confusion among customers who want to upgrade their aging estates ahead of Windows 10 support ending.

So says a senior Gartner analyst who asked The Register recently if we are also hearing that businesses are still "delaying" signing off purchase orders.

"Businesses want to move to AI PCs but not pay a premium as there are no compelling business cases," said Ranjit Atwal, research director for Gartner's Quantitative Innovation Team.

Both Michael Dell and HP CEO Enrique Lores admitted in September that customers were slower to refresh existing fleets of computers than they had anticipated.

Dell said that with Windows 10 standard support expiring on October 25, 2025, enterprise IT departments would realize "we better do something about this." Lores claimed "there is a large and aging installed base," much of which was bought during the COVID pandemic and "will have to be replaced."

According to some estimates, the average cost of an AI PC will be 5-15 percent higher than traditional models, so vendors are obviously keen on promoting these systems. IDC forecast AI PCs to account for almost 50 million units in 2024, and Gartner reckons vendors will ship 43 million units.

According to Canalys last week, AI PCs comprised 20 percent of global shipments in Q3. That's 13.3 million computers sold into the channel – not to end customers. As we noted, buyers still seem unconvinced.

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Atwal at Gartner told us: "Vendors are pushing AI PCs with a premium. Businesses want to move to AI PCs but are waiting for an AI platform that will provide the most future-proofing. CoPilot+ PCs and Recall are further confusing the matter.

"Add Windows 11 upgrades and a general lack of budgets and there are more issues than resolutions. Something will have to give in 2025, and I think it's AI pricing."

A Dell spokesperson told The Register last month, in response to a question about what is sparking interest in the PC market, that AI PCs and Windows 11 are driving the "upgrade opportunity."

"Of the 1.5 billion PCs in use today, 30 percent are four years old or more. None of these older PCs have NPUs to take advantage of latest AI PC advancements, and many of these devices don't meet the hardware requirements to update to Windows 11 – a pressing need as Windows 10 nears its end of support in October 2025. These factors will prompt users to upgrade, with AI capabilities soon to be a standard expectation in PCs."

Marco Andresen, chief operating officer for Lenovo's Intelligent Devices Group, told us: "I think that refresh is coming from the huge spike in sales in 2021, as well as W10 EOS and of course some AI PC impact."

So it seems there is a divergence in the force. ®