a16z Podcast: So Where Are We on the 'S-curve' for PC Devices?

Episode Summary

Executive Summary: Benedict Evans and Steven Sinofsky analyze a wave of new hardware from Google, Apple, and Microsoft through the lens of ecosystems and S-curves. They argue that PC innovation is flattening while mobile/ARM/touch remains the growth curve, making new devices mostly iterative on the old paradigm while true reimagining happens on phones and tablets. They also discuss fragmentation, developer incentives, and how work is shifting away from desk-centric computing.

Main Topics: Hardware announcements as ecosystem signals (Priority: 5/5): The Pixel, MacBook Pro Touch Bar, and Surface Studio are treated less as standalone products and more as signals about who controls hardware, software, and user experience in each ecosystem. Android and Google’s hardware move (Priority: 5/5): They debate why Google entered premium phone hardware with Pixel, whether it is to fix ecosystem issues, gain reach, or challenge OEMs, and how this affects Android partners. S-curves and innovation maturity (Priority: 5/5): The speakers frame PCs as being on a flattened S-curve while mobile/ARM/touch is on the rising curve, explaining why new PC products feel expensive but only incrementally better. Touch, interfaces, and platform transitions (Priority: 5/5): They contrast keyboard/mouse interfaces with touch-first computing, arguing that transitions are discontinuous and hard for both Microsoft and Apple, but that the future is moving toward touch and mobile sensors. Developer ecosystems and fragmentation (Priority: 4/5): The conversation emphasizes that fragmented hardware platforms make it hard to support advanced features and new software experiences, especially on Android where updates and device variation are major constraints. Work is moving off the desktop (Priority: 4/5): They argue that many jobs are now mobile-first or cloud-based, so the assumptions behind PC-centric software and workflows are eroding, even if some professional tools still benefit from new hardware. Incremental innovation vs. reimagining workflows (Priority: 4/5): The Touch Bar and Surface Studio are evaluated as useful, but mostly incremental, because they improve legacy workflows rather than creating entirely new ones for the mass market.

Key Arguments: Google’s Pixel is strategically important because it puts Google into direct hardware competition with OEM partners while aiming to improve reach and showcase Android at the high end. Android’s fragmentation across thousands of devices makes advanced features, updates, and software reliability difficult, especially compared with more controlled ecosystems. The PC market is on a mature, flattened S-curve, so new laptops and desktops are becoming more expensive rather than dramatically more capable. Mobile/ARM/touch represents the newer, faster-growing S-curve, and that is where the most important computing innovation is now occurring. Apple’s MacBook Pro Touch Bar is an incremental, sustaining innovation; it tweaks an existing keyboard/mouse workflow rather than redefining computing. Microsoft’s Surface products are strong devices, but because Microsoft missed the mobile shift, its innovations are largely attempts to extend the old PC paradigm rather than lead the new one. Many real-world work processes are shifting to phones, tablets, cloud software, and vertical mobile apps, reducing the centrality of the traditional PC. New hardware features only matter broadly if developers adopt them; otherwise they remain niche features for a small professional audience.

Data Points: iPhone users: 650 million - Used to illustrate Apple’s enormous mobile ecosystem scale versus Android OEM fragmentation. Android devices: 2,000-3,000 different devices - Referenced as a major fragmentation challenge in Android hardware and software support. PCs on earth: 1.5 billion - Used to compare the size of the PC installed base with iOS devices and to frame market maturity. iOS devices: 900 million - Cited to show Apple’s mobile ecosystem scale and the strength of the ARM/touch curve. Google Play services coverage: 95% of devices - Mentioned to argue that Google’s reach problem is not simply distribution of core services. Surface Studio starting price: $3,000 - Introduced as a high-end desktop device priced like premium professional hardware. Surface Studio upper price: $4,200-$5,000 - Discussed as the fully configured price range for the device. Creative Cloud subscribers: 7 million - Used to show that advanced creative professionals are a relatively small audience compared with total PC users. Salespeople in the U.S.: 25 million - Used as an example of a large mobile-first workforce that increasingly does work on phones. MacBook Pro Touch Bar keyboard function keys: 14 keys - Discussed as a legacy strip of hardware now potentially replaced with software-driven controls.

Pivotal Quotes: "the place where you put the real reimagining of what your whole experience is, is on the iPhone and the iPad" — Benedict Evans: Explaining why the mobile/touch ecosystem, not the PC, is where the main innovation curve lives. "PCs are going to get super expensive now" — Steven Sinofsky: Summarizing the argument that mature platforms become costly, iterative, and less dramatically better over time. "don't expose functionality solely on the touch bar" — Benedict Evans: Discussing Apple’s own guidance, which shows the Touch Bar is meant as an incremental supplement rather than a replacement UI.

Implications: The industry is splitting between mature PC systems and the still-rising mobile/ARM/touch stack. Hardware innovation will matter most when tied to new workflows, but broad adoption depends on developers and ecosystems, not just flashy devices.