A firm's competitive behavior is very important for its survival. Relevant stakeholders in an industry are interested in a firm's operational as well as financial performance. In order to gain competitive advantage, a firm must remain steadfast during changes it goes through over time. This is true for the computer industry as well. The computer industry has been advancing very fast and firms in the industry are experiencing fierce competition for many reasons. This study examines the computer industry in terms of Michael Porter's framework for analyzing the profitability. The authors conduct a critical analysis of the threat of new entrants into the computer industry segment, the bargaining power of suppliers in the industry, the bargaining power of buyers in the industry, the threat of substitute products or services, and rivalry among competitors in the industry. This study has implications for incumbent firms and new entrants into the computer manufacturing industry that evaluate competitive strategies in the industry.

Accelerated response to competition with appropriate actions is one of the major determinants for a firm's sustenance and survival. Both operational and financial performances in terms of gaining and/or keeping competitive advantage always remain under the watchful eyes of the relevant stakeholders in an industry. A firm has to be very vigilant to cope with the internal and external changes it faces over the different phases of its growth. Just like any other industry, this is equally true, in fact more true for the computer industry as well. Continuous innovation in the computer industry has made it a very fast growing and fiercely competitive industry in the field of modern technologies. Firms in this industry always have to be on their toes to tackle the fierce competition created due to many obvious reasons. This study examines the computer industry in the light of Michael Porter's framework for analyzing the profitability. Threats of new entrants and substitute products, bargaining power of both suppliers and buyers, and regular rivalry among the competitors have been analyzed critically. This study may have significant implications in evaluating the competitive strategies developed and applied by the incumbent firms in and the new entrants into the computer manufacturing industry.