As the venerable personal computer turns 30 years old, it may seem heretical to predict its demise. However, the PC appears headed for an early grave as demand for mobility and portable information is pushing consumers toward new high-tech devices.
No less authority than Mark Dean has predicted the personal computer will go the way of the "vacuum tube, typewriter, vinyl records, CRT and incandescent light bulbs." Dean's words carry added weight because he once held the title of chief technology officer at computing Goliath IBM.
Market trends support Dean's prediction. Sales of personal computers have slowed dramatically in the past 18 months, while demand for tablets and smartphones has exceeded forecasts. Mounting evidence suggests that tablets, in particular, are being snapped up as replacements for personal computers.
The news could not come at a worst time for the computer industry. PC shipments declined 6.6 percent in the fourth quarter of last year. In the most recent quarter, shipments rose only 3.2 percent, significantly below historical averages. Analysts had forecast sales growth this year of 13.6 percent.
Despite the modest quarterly gain, consumer appetite for personal computers in the United States, Canada and Europe has waned. The computer industry was able to eke out a sales increase, thanks to growing demand in emerging markets, such as China, India and Turkey.
Even with a three-decade head start, personal computer firms are in danger of being swamped by a tsunami of competition. Data indicates that for the first time in history more smartphones have shipped this year than personal computers.
Smartphone sales reached 115 million in the third quarter, a 42 percent increase from the same period a year ago. Worldwide sales of smartphones are predicted to top 468 million this year, according to Gartner, a tech research firm. By comparison, Gartner forecasts 352 million PC's will be sold in 2011.
If smartphone sales are sizzling, then tablets are on fire. Apple, the market leader with its iPad, expects to sell 40 million tablets this year. The year over year growth is north of 342 percent. iPads are selling at a rate of 1.22 every second of every day. Data shows consumers are junking their notebook computers in favor of iPads.
The Apple juggernaut has captured 61 percent of the tablet market in spite of fierce competition. In its most recent quarter, iPad sales topped $6 billion. The tablet has become the top selling consumer electronics device ever in a little over 18 months.
While tablets are cannibalizing consumer PC sales, smartphones are invading the personal computer's business turf. More smartphones are being linked to enterprise applications once reserved for PC's. Medical centers, universities, small businesses and even auto companies are swapping smartphones for PC's.
Worst of all, most of the largest computer makers have no PC alternatives. None offer smartphones or tablets, except HP. The firm purchased Palm in April of last year, but has stumbled in the market. HP introduced a flashy tablet earlier this year then quickly withdrew it because of moribund sales.
What's behind the rapid ascent of smartphones and tablets? There are two chief reasons for the growth: technology advancements are leveling the playing field between smartphones, tablets and PC's; and, users are demanding anywhere-anytime access to personal and public data and information.
Today's smartphones have more computing power than the average PC's of just a decade or more ago. Most smartphones have storage capacity of 16 to 64 gigabytes. A desktop computer in 1998 typically could store up to two gigabytes. The computer of that era had 64 megabits of memory, compared to more than 256 megabits of random access memory for today's smartphones.
The other disruptive trend for the computer industry is the demand for portable information. Consumers no longer want to be shackled to a single computer to access their videos, photos, email, documents and music. They want to get data and information whenever and wherever they happen to be.
While PC's are busy fending off smartphones and tablets, another competitor has emerged. Smart televisions are entering the marketplace. The new sets have built-in Internet connectivity, offer games, high-tech applications and a myriad of features that mimic those available on personal computers.
Despite all the competition, PC's will not disappear overnight. Increasing sales in foreign markets will continue to prop up the industry. However, in time death will come slowly but surely for the PC.
For a 30 year old, that's a foreboding prospect.
Tuesday, November 29, 2011
Saturday, November 19, 2011
News Media Exposes Its Unseemly Underbelly
Media ethics are an oxymoron in an era when news outlets thrive on assassinating the reputations of public figures with unproven allegations while sacrificing what few principles they profess on the altar of shameless exploitation.
Two recent high-profile cases underscore this sleazy brand of journalism. The pillorying of presidential candidate Herman Cain and the savaging of college football coach Joe Paterno are recent examples of how the media has abandoned all pretense of fairness and objectivity in reporting.
Once standards dictated that journalists wait for law enforcement officials to file charges before reporting on allegations, heresy or gossip. But in the race for ratings, media organizations now turn to sensationalism, shock and sex to pander to their audience's worst prurient interests.
Before taking up the Cain and Paterno cases, a caveat is in order. What follows is NOT a defense of either man, but an indictment of the reporters and editors who have allowed their own bias and views to trample journalistic professionalism.
Weeks ago unfounded allegations surfaced regarding Cain's alleged sexual harassment of women. The media smelled blood when Cain stumbled in his initial denials. That was all the license they needed to air innuendo and salacious statements from alleged and often anonymous victims.
After some crawfishing Cain did admit that a sexual harassment settlement was made without his knowledge by his former employer. That became a lightning rod for the media, which treated the legal deal as an admission of guilt.
News coverage of the Cain allegations stands in sharp contrast to similar sexual harassment charges against President Clinton. In 1999, Clinton quietly reached an out-of-court settlement in the sexual harassment case filed by Paula Jones after his repeated claims of innocence.
The legal maneuver came on the heels of a federal district judge's criticism of Clinton for "willful failure" to obey her repeated orders to testify truthfully in the lawsuit lodged by Ms. Jones. The judged fined Clinton for his conduct. News of the settlement was either buried or not mentioned.
Judging from the news treatment of the allegations against Cain, there can be no question of the media's double standard. It also begs the question: If Clinton was fit to remain as president despite a sexual harassment settlement, why should a similar legal agreement disqualify Cain from that office?
While Cain continues to soldier on in the presidential race, Penn State's Joe Paterno has been forced out by the board of trustees after 46 years as head football coach. The action follows a grand jury investigation of former assistant coach Jerry Sandusky, who has been charged with 40 counts of sexual abuse of children.
Once the scandal broke, several top Penn State officials, including the athletic director, stepped down. Immediately the news media, including influential sports media giant ESPN, demanded Paterno's resignation, even though prosecutors had indicated the coach would not be charged with a crime.
Among the few facts released by the prosecutors was a report that once Paterno was made aware of the allegation, the head coach advised the athletic director as required. In a later statement, Paterno publicly admitted remorse for not doing more to investigate the allegation.
That admission didn't satisfy the media's unquenchable thirst to humiliate Paterno. The media's suffocating coverage bullied the university's trustees into a hastily called meeting that ended with Paterno's firing, depriving the coach of an opportunity to gracefully step down days before it was revealed he had lung cancer.
One only has to remember the Duke lacrosse case as a cautionary tale of media justice. To refresh your memory, three members of the Duke lacrosse team were charged in 2006 with raping a woman at a party. Because of the university's pristine reputation, the media enthusiastically reported the allegations and battered Duke's reputation as if it was a piñata.
After more than a year of unrelenting coverage, the charges were proven false and the unscrupulous prosecutor in the case was disbarred. Unfortunately, the facts surfaced after the Lacrosse coach had been fired, player reputations were ruined and the team's season cancelled by the university president.
Paterno and Cain may indeed be guilty of crimes. If so, they deserve our scorn. But until they are charged in a court of law and a jury finds them guilty, they remain innocent. The heinous nature of the allegations do not justify the media's rush to judgment.
Fairness and objectivity may seem like quaint values to today's journalists, but they are standards worth upholding. Media consumers should demand nothing less.
Two recent high-profile cases underscore this sleazy brand of journalism. The pillorying of presidential candidate Herman Cain and the savaging of college football coach Joe Paterno are recent examples of how the media has abandoned all pretense of fairness and objectivity in reporting.
Once standards dictated that journalists wait for law enforcement officials to file charges before reporting on allegations, heresy or gossip. But in the race for ratings, media organizations now turn to sensationalism, shock and sex to pander to their audience's worst prurient interests.
Before taking up the Cain and Paterno cases, a caveat is in order. What follows is NOT a defense of either man, but an indictment of the reporters and editors who have allowed their own bias and views to trample journalistic professionalism.
Weeks ago unfounded allegations surfaced regarding Cain's alleged sexual harassment of women. The media smelled blood when Cain stumbled in his initial denials. That was all the license they needed to air innuendo and salacious statements from alleged and often anonymous victims.
After some crawfishing Cain did admit that a sexual harassment settlement was made without his knowledge by his former employer. That became a lightning rod for the media, which treated the legal deal as an admission of guilt.
News coverage of the Cain allegations stands in sharp contrast to similar sexual harassment charges against President Clinton. In 1999, Clinton quietly reached an out-of-court settlement in the sexual harassment case filed by Paula Jones after his repeated claims of innocence.
The legal maneuver came on the heels of a federal district judge's criticism of Clinton for "willful failure" to obey her repeated orders to testify truthfully in the lawsuit lodged by Ms. Jones. The judged fined Clinton for his conduct. News of the settlement was either buried or not mentioned.
Judging from the news treatment of the allegations against Cain, there can be no question of the media's double standard. It also begs the question: If Clinton was fit to remain as president despite a sexual harassment settlement, why should a similar legal agreement disqualify Cain from that office?
While Cain continues to soldier on in the presidential race, Penn State's Joe Paterno has been forced out by the board of trustees after 46 years as head football coach. The action follows a grand jury investigation of former assistant coach Jerry Sandusky, who has been charged with 40 counts of sexual abuse of children.
Once the scandal broke, several top Penn State officials, including the athletic director, stepped down. Immediately the news media, including influential sports media giant ESPN, demanded Paterno's resignation, even though prosecutors had indicated the coach would not be charged with a crime.
Among the few facts released by the prosecutors was a report that once Paterno was made aware of the allegation, the head coach advised the athletic director as required. In a later statement, Paterno publicly admitted remorse for not doing more to investigate the allegation.
That admission didn't satisfy the media's unquenchable thirst to humiliate Paterno. The media's suffocating coverage bullied the university's trustees into a hastily called meeting that ended with Paterno's firing, depriving the coach of an opportunity to gracefully step down days before it was revealed he had lung cancer.
One only has to remember the Duke lacrosse case as a cautionary tale of media justice. To refresh your memory, three members of the Duke lacrosse team were charged in 2006 with raping a woman at a party. Because of the university's pristine reputation, the media enthusiastically reported the allegations and battered Duke's reputation as if it was a piñata.
After more than a year of unrelenting coverage, the charges were proven false and the unscrupulous prosecutor in the case was disbarred. Unfortunately, the facts surfaced after the Lacrosse coach had been fired, player reputations were ruined and the team's season cancelled by the university president.
Paterno and Cain may indeed be guilty of crimes. If so, they deserve our scorn. But until they are charged in a court of law and a jury finds them guilty, they remain innocent. The heinous nature of the allegations do not justify the media's rush to judgment.
Fairness and objectivity may seem like quaint values to today's journalists, but they are standards worth upholding. Media consumers should demand nothing less.
Saturday, November 12, 2011
Entitlement Reform: A Grim Fairy Tale
The prospect of a far-reaching budget agreement from the Congressional "super committee" is looking more every day like another Washington fairy tale. With a November 23 deadline looming, the 12-member panel seems destined to fumble the opportunity to end runaway deficits.
Unlike discretionary spending, entitlement expenditures are mandated in the budget. That means Congress has no authority to cut entitlement budgets. Each year's budget is based on several factors, including estimates of expenditures and the anticipated number of recipients. The only way lawmakers can address entitlements is to change the laws that created the programs.
Many political pundits are blaming partisan bickering for the gloomy outlook. They are only half-right. There likely will be no overarching deal, but it will be because President Obama has no intention to be party to any agreement that reduces funding for Social Security, Medicare and Medicaid.
The president long ago signaled his intentions. In February, he was asked why his proposed 2012 budget failed to tackle soaring entitlement spending. He dodged responsibility, tossing the issue back in the laps of lawmakers to hammer out a deal to fix entitlements.
"If you look at the history of how these deals get done, it's typically not because there's an Obama plan out there," the president said at a news conference. In other words, Americans should not look to their leader for solutions to thorny issues when they can be sloughed off to another branch of government.
As written in this space months ago, President Obama clearly intends to make saving Social Security, Medicare and Medicaid a key plank in his reelection campaign. A bipartisan deal robs the president of stump speeches accusing Republicans of trying to scuttle entitlements for seniors.
Politics aside, without drastic entitlement reform, nothing can be done about the yawning budget deficits. No amount of tax increases would bring spending in line with revenues. The math doesn't work, no matter how many times Obama and the Democrats trot out the line about millionaires paying more taxes.
For starters, the sheer size of entitlement costs dwarfs all discretionary programs. In 2011, all spending on entitlements topped $2 trillion, exceeding all the taxes collected by the federal government. That figure includes not only the Big Three, but also food assistance, unemployment insurance and smaller aid programs.
Only a few years ago, the budget picture was not so dire. In 2007, federal revenues exceeded mandatory entitlement spending by $1.17 trillion. The following year, the last of the Bush Administration, tax revenues covered entitlements with $914 billion to spare.
Since Obama assumed the presidency, the situation has reversed as deficits have swamped the nation's tax resources. Under President Obama's latest budget, entitlement spending is pegged at $2.109 trillion this fiscal year, widening the deficit.
Entitlements costs trend sharply upward in future years. Obama's own forecasts show entitlement spending will reach $5.7 trillion by 2021, nearly triple this year's budget. If the estimates are accurate, the cumulative deficit with top $7 trillion by that year.
Since Obama assumed the presidency, the situation has reversed as deficits have swamped the nation's tax resources. Under President Obama's latest budget, entitlement spending is pegged at $2.109 trillion this fiscal year, widening the deficit.
Entitlements costs trend sharply upward in future years. Obama's own forecasts show entitlement spending will reach $5.7 trillion by 2021, nearly triple this year's budget. If the estimates are accurate, the cumulative deficit with top $7 trillion by that year.
The astronomical increases are expected to occur as the population ages and health care costs continue to escalate. The problem will be exacerbated by the fact there will be fewer workers per retiree paying taxes into Social Security, Medicare and Medicaid.
Unlike discretionary spending, entitlement expenditures are mandated in the budget. That means Congress has no authority to cut entitlement budgets. Each year's budget is based on several factors, including estimates of expenditures and the anticipated number of recipients. The only way lawmakers can address entitlements is to change the laws that created the programs.
If every discretionary spending program, including national defense, ended tomorrow the nation would still have to trim entitlements to lower deficits. To underscore that point, since 1976 entitlement spending has eclipsed budget expenditures on national defense in every fiscal year. In 2011, entitlement expenditures were three times larger than the military budget.
Despite all the evidence supporting the need for entitlement reform, the president and his party seem oblivious to the obvious. That's why no one should expect comprehensive entitlement reform as part of any deal to meet the objective of reducing the deficit by at least $1.2 trillion over the next decade.
Instead, the committee will produce a modest plan polished with eye-popping dollar signs aimed at duping the public into thinking Congress has taken bold steps to prune creaky entitlements. However, in the fine print you will likely read that entitlements survive unscathed with only minor tweaks while discretionary items shoulder the brunt of the budget snipping.
Once the deal is announced, the media will gush over the "landmark" agreement. Credit rating agencies won't be fooled, however, and will likely downgrade U.S. debt. For his part, the president will sharpen his attacks on Republicans, blaming them for not raising taxes on the rich and threatening to end entitlements for seniors.
Hopefully, most Americans will see through the shabby political charade. Those who don't will be ones who still believe in fairy tales.
Despite all the evidence supporting the need for entitlement reform, the president and his party seem oblivious to the obvious. That's why no one should expect comprehensive entitlement reform as part of any deal to meet the objective of reducing the deficit by at least $1.2 trillion over the next decade.
Instead, the committee will produce a modest plan polished with eye-popping dollar signs aimed at duping the public into thinking Congress has taken bold steps to prune creaky entitlements. However, in the fine print you will likely read that entitlements survive unscathed with only minor tweaks while discretionary items shoulder the brunt of the budget snipping.
Once the deal is announced, the media will gush over the "landmark" agreement. Credit rating agencies won't be fooled, however, and will likely downgrade U.S. debt. For his part, the president will sharpen his attacks on Republicans, blaming them for not raising taxes on the rich and threatening to end entitlements for seniors.
Hopefully, most Americans will see through the shabby political charade. Those who don't will be ones who still believe in fairy tales.
Saturday, November 5, 2011
Obama's Uneducated College Gambit
President Obama's executive fiat to relax the rules for repaying college loans was a calculated political ploy aimed at placating student voters and liberal academia. However, his gambit will do nothing to solve the national crisis of skyrocketing costs for tuition at private and public universities.
Instead of addressing the real problem, the president choose once again to rely on the federal government as the remedy. Yet by providing financial aid and subsidized loans, the federal government is enabling colleges to raise tuition costs without any concern for the impact on students' ability to pay.
A 2007 study by University of Oregon economists produced compelling evidence to support that claim. Their research found that universities "tend to absorb most federal student aid by increasing their tuition revenue." In other words, as grants increase, universities are embolden to raise tuition costs.
Patrick Callan, president of the National Center for Public Policy and Higher Education, took note of the same issue in a recent interview. "For 25 years we've been putting more and more money into financial aid and tuition keeps going up. We're on a national treadmill."
In the midst of an anemic economy, tuition and fees at public colleges soared eight percent this year. Private universities raised tuition and fees by 4.5 percent On average over the last 30 years, college tuition rates have increased at double the general inflation rate.
As a result, the average tuition at a four-year public university for in-state students now stands at $21,447 annually. The same costs at a four-year private college average $42,224. However, with financial aid, the average net price paid at both private and public universities is significantly less than those costs.
Students at public colleges pay on average about 75 percent of the advertised tuition costs. Their counterparts at private universities only shell out an average of 66 percent of the sticker price for a higher education, according to the College Board. As these figures illustrate, financial aid helps insulate students from price increases.
To keep pace with escalating costs, financial assistance to college students has ascended at a blistering 438 percent over the past three decades, the College Board estimates. This spike in funds is the result of dramatic increases in federal grant and loan programs.
For example, last fiscal year the government doled out a record $12.2 billion in Pell Grants to needy students. Government student loans totaled $130 billion. Throw in another $250 billion in private loans and you have $392.2 billion in financial aid funneled to college students in a single year.
Those billions are only the tip of the iceberg. The federal government estimates there are more than 88,500 loan and aid programs administered by Washington, the states, private foundations and scholarship organizations in the United States.
But often government financial aid comes with a catch. Students must repay the money, except in the case of Pell Grants. The College Board estimates that the average student graduates with $24,000 in debt. A full 10 percent of students have loans of $40,000 and more. Two-thirds of students who graduate owe money for college loans.
All those billions in loans are adding up to a potential giant headache for the economy. This year total outstanding student loan debt passed $1 trillion, which exceeds consumer credit card debt in America. By easing rules on loan repayments, the president risks triggering a wave of student defaults and adding to the growing problem of unpaid balances. If that happens, the government will be faced with the prospect of another costly bailout.
Public and private universities have dodged any blame for escalating costs. They point to price increases for everything from scholarly journals to pay for professors. However, studies have shown that the lion's share of the tuition increases at many institutions have gone to add buildings, facilities, gyms, technology and to upgrade dorms.
Academic leaders also justify tuition increases by pointing to cuts in state funding. They act as if the only solution is higher prices to offset reduced subsidies. Unlike any other business, they reject the idea of paring budgets to reflect new economic realities.
Meanwhile, there is no credible evidence that the added spending has improved the quality of higher education. Parents and students are paying more money for the same education, albeit in fancier buildings fitted with high tech gadgets.
That's why the president's pandering to young voters and the elitist university establishment is such a pathetic gesture. Too bad the president's own college degree did not better prepare him to address the issue of runaway higher education costs affecting students and their parents.
Instead of addressing the real problem, the president choose once again to rely on the federal government as the remedy. Yet by providing financial aid and subsidized loans, the federal government is enabling colleges to raise tuition costs without any concern for the impact on students' ability to pay.
A 2007 study by University of Oregon economists produced compelling evidence to support that claim. Their research found that universities "tend to absorb most federal student aid by increasing their tuition revenue." In other words, as grants increase, universities are embolden to raise tuition costs.
Patrick Callan, president of the National Center for Public Policy and Higher Education, took note of the same issue in a recent interview. "For 25 years we've been putting more and more money into financial aid and tuition keeps going up. We're on a national treadmill."
In the midst of an anemic economy, tuition and fees at public colleges soared eight percent this year. Private universities raised tuition and fees by 4.5 percent On average over the last 30 years, college tuition rates have increased at double the general inflation rate.
As a result, the average tuition at a four-year public university for in-state students now stands at $21,447 annually. The same costs at a four-year private college average $42,224. However, with financial aid, the average net price paid at both private and public universities is significantly less than those costs.
Students at public colleges pay on average about 75 percent of the advertised tuition costs. Their counterparts at private universities only shell out an average of 66 percent of the sticker price for a higher education, according to the College Board. As these figures illustrate, financial aid helps insulate students from price increases.
To keep pace with escalating costs, financial assistance to college students has ascended at a blistering 438 percent over the past three decades, the College Board estimates. This spike in funds is the result of dramatic increases in federal grant and loan programs.
For example, last fiscal year the government doled out a record $12.2 billion in Pell Grants to needy students. Government student loans totaled $130 billion. Throw in another $250 billion in private loans and you have $392.2 billion in financial aid funneled to college students in a single year.
Those billions are only the tip of the iceberg. The federal government estimates there are more than 88,500 loan and aid programs administered by Washington, the states, private foundations and scholarship organizations in the United States.
But often government financial aid comes with a catch. Students must repay the money, except in the case of Pell Grants. The College Board estimates that the average student graduates with $24,000 in debt. A full 10 percent of students have loans of $40,000 and more. Two-thirds of students who graduate owe money for college loans.
All those billions in loans are adding up to a potential giant headache for the economy. This year total outstanding student loan debt passed $1 trillion, which exceeds consumer credit card debt in America. By easing rules on loan repayments, the president risks triggering a wave of student defaults and adding to the growing problem of unpaid balances. If that happens, the government will be faced with the prospect of another costly bailout.
Public and private universities have dodged any blame for escalating costs. They point to price increases for everything from scholarly journals to pay for professors. However, studies have shown that the lion's share of the tuition increases at many institutions have gone to add buildings, facilities, gyms, technology and to upgrade dorms.
Academic leaders also justify tuition increases by pointing to cuts in state funding. They act as if the only solution is higher prices to offset reduced subsidies. Unlike any other business, they reject the idea of paring budgets to reflect new economic realities.
Meanwhile, there is no credible evidence that the added spending has improved the quality of higher education. Parents and students are paying more money for the same education, albeit in fancier buildings fitted with high tech gadgets.
That's why the president's pandering to young voters and the elitist university establishment is such a pathetic gesture. Too bad the president's own college degree did not better prepare him to address the issue of runaway higher education costs affecting students and their parents.