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Can Intel Corporation (INTC)’s Newest Chip Revive the PC Industry?

There’s no denying that Intel Corporation (NASDAQ:INTC) Haswell represents a tremendous advancement for portable PC computing over its Ivy Bridge predecessor. A whole generation of laptops, Ultrabooks, and 2-in-1 convertible devices are about to benefit from markedly improved battery performance to the point where the PC officially levels the power consumption playing field against the tablet. As always with cutting-edge technology, the price won’t come cheap at first. In the beginning, users can realistically expect to pay anywhere between double and triple the expected $381 average selling price of a tablet.

Intel Corporation (NASDAQ:INTC)

The hope is that consumers will justify the premium over tablets in exchange for the added productivity. The 13-inch Apple Inc. (NASDAQ:AAPL) MacBook Air powered by Intel Corporation (NASDAQ:INTC) Haswell is advertised to achieve a staggering 12-hour battery life and weighs less than 3 pounds. But because it starts at $1,099, the everyday PC user who mostly surfs the Web and reads emails may have a hard time seeing the value, especially considering a $499 iPad with a Retina display is rated for 10-hour battery life. To put the price of a 10-inch iPad in perspective, the MacBook Air’s Haswell processor alone costs $342 for the base model and $454 for the upgraded version.

The million-dollar question for the PC industry is whether Haswell will be the silver bullet that slows the decline of PC sales. Unfortunately, that prospect isn’t looking promising.

Strong headwinds
I’m sure by now you’re familiar with this whole “death of the PC” storyline. The reality is that PCs continue to make up less and less of the overall computing pie, thanks largely in part to the worldwide proliferation of tablets and smartphones. As a result, this behavioral shift change is prolonging the consumer PC replacement cycle. The most recent numbers from IDC suggest that worldwide tablet shipments will surpass portable PC shipments this year, and by 2015, tablet shipments will outpace total PC shipments. It’s not very often the world experiences a step-change this profound, and I’m not sure one single piece of silicon, no matter how great, can get the world to fall back in love with PCs.

Hopes and dreams
If widespread adoption rates of smartphones and tablets told us one thing, it would be that everyday computing users have found adequate computing solutions for their needs. Like it or not, the PC recovery storyline is up against a massive shift in computing behavior, and I’m not sold that a piece of silicon that currently costs as much as some tablets will stop the bleeding.

The article Can Intel’s Newest Chip Revive the PC Industry? originally appeared on and is written by Steve Heller.

Fool contributor Steve Heller owns shares of Apple and Intel. The Motley Fool recommends and owns shares of Apple and Intel.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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