PC upgrades: not always an easy call for IT execs

How often should you replace your PCs? That all depends.

Ask what seems like a simple question -- How often should PCs be replaced? -- and you'll find that for IT managers, the answer isn't so simple. And it's certainly not universal.

The correct answer at Grant Thornton is 24 months. And next month, the US-based accounting and management consulting firm plans to replace 5,000 laptop and desktop PCs that have reached the two-year usage limit.

At Southern Co., an electricity generator and utility operator in Atlanta that has about 23,000 PCs, the answer is three years for laptops. But 18 months ago, it began replacing desktop systems every four years.

And Virgin Entertainment Group has no single answer to the PC replacement question. Instead, the company has an "on demand" refresh policy under which it replaces systems as needed, based on the business requirements of individual workers or departments. Some of its 700 PCs, in particular the desktops, may be four or even five years old.

For IT execs in general, financing arrangements, the ways PCs have been used, the need for more processing power to run resource-intensive applications, and "softer" issues -- such as keeping younger employees happy by giving them new technology -- can all be considerations in deciding when to replace systems.

But while there may not be any real consensus among companies, the broader IT trends point to an expanding period between PC refreshes.

Many companies have settled on a three-year refresh cycle for laptops and a four-year window for desktops, said Gartner Inc. analyst Leslie Fiering, who added that the replacement cycles have increased over the past few years. Four years isn't even out of the question for laptops or notebook PCs, Fiering said.

Of all the factors that can influence a PC replacement schedule, accounting may be the most important. And while the slowing economy may prompt some companies that treat their PCs as a capital expense to hold on to the systems longer, many businesses lease their equipment and are sticking with the refresh schedules in their contracts, as is the case at Grant Thornton.

Dave Johnson, the firm's director of infrastructure and technology, said that he gets a higher residual value on systems by taking them under a shorter lease, thus helping to lower his overall costs. And, he said, the lease payments take the residual-value calculations into account, "so it doesn't necessarily pay to go out much beyond 30 to 36 months."

But financing issues aren't all that's in play. For instance, laptops are the point of the technology spear at Grant Thornton. Its work involves a lot of travel to client sites, which can be tough on IT equipment. Johnson said the durability of laptops is increasing, but not enough for him to extend his 24-month refresh cycle.

Another reason why the two-year cycle still makes sense for Johnson is that he can be certain the hardware he gives his users will meet their application needs for that amount of time. "The further out you go, the better your crystal ball needs to be as to exactly what you are going to be running three to four years from now," he said.

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