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Apple snags nearly 10% of US PC market in third quarter

post #1 of 28
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With just days to go before Apple announces the results of its fourth fiscal quarter, new data from market research firm Gartner has the Mac maker snagging a near 10 percent share of the US PC market for the three month period ending September, with its unit shipments growing more than six times the industry average.

In predictions published on Tuesday, Gartner believes Apple will have shipped about 1.64 million Macs to Americans over the course of the summer and thus will have earned itself 9.5 percent of the market in its home territory, which saw about 17.4 million computers shipped in total.

The figure is a full percentage point up from spring numbers and 29.4 percent higher than Apple's market share in summer 2007 -- more than double the growth rate of its closest rival, Acer, and nearly 6.4 times the industry average of a simple 4.6 percent.

These gains by the Cupertino, Calif.-based electronics firm also extend its lead over those below it in the rankings and narrow the still-wide gap between itself and second-place HP.

Acer and Toshiba grew their shares by just 0.4 percent and 0.1 percent respectively between the spring and summer and now give Apple a more comfortable 0.6 percent edge. HP has a full 25.7 percent share but had only moved slightly from 25.3 percent in the spring.

Preliminary U.S. PC Vendor Unit Shipment Estimates for 3Q08 (Thousands of Units) | Source: Gartner

Apple's gains come in spite of market forces working against it, Gartner says. The average selling price of a PC has continued to drop in part thanks to netbooks, which often sell for under $500 and accounted for as much as five percent of the US market; Apple hasn't involved itself in this arena. Moreover, this attempt to consciously lower prices isn't thought to have had the intended effect.

"Despite the back to school sales season, the U.S. home market did not see its typical seasonal spike during the quarter," Gartner analyst Mika Kitagawa says. "The continued decline of the average selling price... did not stimulate sales as much at the vendors had hoped."

MacBooks are seen as having largely bucked this trend by appealing to education and home users, which are currently less reactive to a weak market than businesses.

Worldwide, Apple again failed to place in the top five and still has significant room to grow before it can count among their ranks. Fifth-place Toshiba sits at 4.6 percent, or nearly 3.7 million units, of all PCs leaving factories this past summer.

Preliminary Worldwide PC Vendor Unit Shipment Estimates for 3Q08 (Thousands of Units) | Source: Gartner

Almost 80.6 million PCs are estimated to have shipped from all companies during the three-month period and were led by American powerhouses HP and Dell, which took 18.4 percent (14.8 million PCs) and 13.6 percent (11 million PCs) of the market each. Acer and Lenovo occupy third and fourth on the world stage.

It was regions beyond North America that led the computer industry, according to Gartner, with Africa, Europe and the Middle East spurring the bulk of growth. Asia/Pacific, which is home to all the non-American companies in the world list, was hit by sluggish performance in China.
post #2 of 28
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post #3 of 28
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Originally Posted by walshbj View Post

Snowball.

Effect.
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post #4 of 28
price - main reason it cannot break into top 5 world wide

market specific mac (specs & price) may change that ...

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post #5 of 28
I think that, given the growth in demand (and market share), they strategically decided to moderate the price cuts on the new laptops introduced today. Ergo, the the margin reduction from whatever-the-heck-it-was that Oppenheimer warned about in the last quarter will not happen (at least, not as badly as feared). Ergo, positive margin surprises in the offing for the fourth quarter and beyond, and......
post #6 of 28
Yea, were is the massive margin reduction? Is Nvidia charging them an arm and a leg? The prices dont seem to have dropped enough to put that much pressure on the margins. If anything, it would seem like they are trying to steer more people into the MBP vs the MB (higher margins)
post #7 of 28
Quote:
Originally Posted by shanmugam View Post

price - main reason it cannot break into top 5 world wide

market specific mac (specs & price) may change that ...

I agree partly, as cheaper is always better for unit sales, but I think mainly it's the lack of market penetration in most countries. They only have 247 stores worldwide adn their non-US retailers are pretty low compared to the other vendors.

Despite only having 9.5% of the total US PC sales, don't they get 1/3 of all profits in the US?
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post #8 of 28
There's a lot of risk in the low price marketshare chase.

The global personal computer market grew during the third quarter, but not the way PC makers had hoped.

However, a chunk of the growth came from sales of computers that are not particularly profitable: low-cost, Internet centric devices.

The profit margins are sufficiently low on these devices – they often sell for less than $500 – that some PC makers aren’t even bother to make them, or have been slow to embrace the concept.


NYTimes
post #9 of 28
Quote:
Originally Posted by markb View Post

Yea, were is the massive margin reduction? Is Nvidia charging them an arm and a leg? The prices dont seem to have dropped enough to put that much pressure on the margins. If anything, it would seem like they are trying to steer more people into the MBP vs the MB (higher margins)

One thing is that the new cases are costing a lot to manufacture.
post #10 of 28
Quote:
Originally Posted by melgross View Post

One thing is that the new cases are costing a lot to manufacture.

Where did you get that specific data? And how do you know what the overall cost/savings are?

According to Steve it takes less man power, less time to assemble, is much more durable hence will be saving Apple money on having to repair broken parts. So where did you get the info that Apple is making less money by using this manufacturing process?
post #11 of 28
Quote:
Originally Posted by solipsism View Post

Despite only having 9.5% of the total US PC sales, don't they get 1/3 of all profits in the US?

Connect the 2 statistics please.

They measure two different things.

If they are only getting 1/3 of the profits from US sales which represents a disproportionate percentage of unit sales, then that would indicate they are gouging foreign customers to subsidise local sales, which not surprisingly would be higher, because they are getting the free ride.

Actually determining the relationship between total global sales and the details of the USA sales is impossible from this story. Typically this report so mixes numbers, percentages, time periods and regions that attempts at comparison are useless.

What is the point of increased USA sales in a global market that is growing much faster outside the USA. Unless it is to highlight failed opportunities. It is like bragging about good sales in New Hampshire. Big deal. How many computers were really shipped in total?
post #12 of 28
Quote:
Originally Posted by iPeon View Post

Where did you get that specific data? And how do you know what the overall cost/savings are?

According to Steve it takes less man power, less time to assemble, is much more durable hence will be saving Apple money on having to repair broken parts. So where did you get the info that Apple is making less money by using this manufacturing process?

What Jobs is saying doesn't negate what I'm saying. Complex machining is always more expensive than punching and forming.

A lot if operations still have to be done. Some take more time than ones that have been replaced.

The benefit to this process is strength, as they say, but it's not cheaper.

Saving on repairs is something else. Where did he say that?
post #13 of 28
Quote:
Originally Posted by gastroboy View Post

Connect the 2 statistics please.

They measure two different things.

If they are only getting 1/3 of the profits from US sales which represents a disproportionate percentage of unit sales, then that would indicate they are gouging foreign customers to subsidise local sales, which not surprisingly would be higher, because they are getting the free ride.

Actually determining the relationship between total global sales and the details of the USA sales is impossible from this story. Typically this report so mixes numbers, percentages, time periods and regions that attempts at comparison are useless.

What is the point of increased USA sales in a global market that is growing much faster outside the USA. Unless it is to highlight failed opportunities. It is like bragging about good sales in New Hampshire. Big deal. How many computers were really shipped in total?


The stats about one third profits, means one third of the profits made by computer companies selling computers in the US. It doesn't mean one third of Apple's profits. It's more like two thirds.

The numbers come about because Apple sells 66% of all computers over $1,000 in the US. The low price computers others sell sometimes don't make a profit at all. Sometimes, on sale, they lose money for their makers.

It's even said that computer makers earn a substantial amount of their profit from the programs and trial programs installed on new machines, as they're paid by the software companies to do so, and that without that money, they might lose money on each sale of an inexpensive machine.
post #14 of 28
Thank you Melgross for that clarification.
post #15 of 28
Surely, what matters is that Apple is blowing the others out of the water?

Apple is growing market share AND retaining good margins. The rest are forced to fight over the much lower, leftover margins at the bottom end.

Sounds like a recipe for huge success to me.
post #16 of 28
Quote:
Originally Posted by shanmugam View Post

price - main reason it cannot break into top 5 world wide


Bingo. Not the only reason, but it's Public Enemy No.1 on the list. \

You gotta wonder what'd happen if Apple ever set its sights on the $800-1000 market in a meaningful way. I'm sure HP and Dell pray every day that Apple doesn't go there.

I don't really count the 'new old' $999 MacPlastiBook as part of that effort. It's history if it even looks at Steve funny.

-
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post #17 of 28
Quote:
Originally Posted by TBaggins View Post

Bingo. Not the only reason, but it's Public Enemy No.1 on the list. \

You gotta wonder what'd happen if Apple ever set its sights on the $800-1000 market in a meaningful way. I'm sure HP and Dell pray every day that Apple doesn't go there.

I don't really count the 'new old' $999 MacPlastiBook as part of that effort. It's history if it even looks at Steve funny.

-

You're lucky, the 'new old' $999 MacPlastiBook just went up $200 in Australia.

I was thinking about getting one but just did a U-turn.

Just a couple of months ago I got a pretty decent Compaq laptop for half the price of the previous price of a MacBook.
post #18 of 28
Quote:
Originally Posted by gastroboy View Post

You're lucky, the 'new old' $999 MacPlastiBook just went up $200 in Australia.

I was thinking about getting one but just did a U-turn.

Just a couple of months ago I got a pretty decent Compaq laptop for half the price of the previous price of a MacBook.


My pardon. I sometimes forget that, as bad as Steve shakes down Mac users in the USA, he does it even more so to many of our foreign brethren.

On the plus side, your women are hot.

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post #19 of 28
Quote:
Originally Posted by TBaggins View Post

On the plus side, your women are hot.

-

And most women don't care what kind of notebook you own.
post #20 of 28
Quote:
Originally Posted by vinea View Post

And most women don't care what kind of notebook you own.


They don't? Damn. My entire world-view is shattered.

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post #21 of 28
Quote:
Originally Posted by TenoBell View Post

There's a lot of risk in the low price marketshare chase.

The global personal computer market grew during the third quarter, but not the way PC makers had hoped.

However, a chunk of the growth came from sales of computers that are not particularly profitable: low-cost, Internet centric devices.

The profit margins are sufficiently low on these devices – they often sell for less than $500 – that some PC makers aren’t even bother to make them, or have been slow to embrace the concept.


NYTimes


I don't think anyone's advocating that Apple jump into the sub-$500 market. It'd be a bad idea, for many obvious reasons.

But what about the upper reaches of the sub-$1000 market? Much of the industrialized world is either in recession or will be soon. And said recession looks like it'll be a long one. Does it make much sense to have a 'premium product only/mostly' mindset for Apple's Mac business in such an environment?

I'd say that Apple 'staying the course' is fraught with more risks than being aggressive in this environment, actually.

_
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post #22 of 28
Quote:
Originally Posted by TBaggins View Post

I don't think anyone's advocating that Apple jump into the sub-$500 market. It'd be a bad idea, for many obvious reasons.

But what about the upper reaches of the sub-$1000 market? Much of the industrialized world is either in recession or will be soon. And said recession looks like it'll be a long one. Does it make much sense to have a 'premium product only/mostly' mindset for Apple's Mac business in such an environment?

I'd say that Apple 'staying the course' is fraught with more risks than being aggressive in this environment, actually.

_

That article I linked to said most of the growth in the computer market this year was either below $500 or above $1000.

The majority of people wanted a really good computer or an extreme budget one.
post #23 of 28
Quote:
Originally Posted by TenoBell View Post

That article I linked to said most of the growth in the computer market this year was either below $500 or above $1000.

The majority of people wanted a really good computer or an extreme budget one.

I'm not sure how they do they averaging, but apparently $800 is average price for a non-Mac PC, while around $1,500 for a Mac PC. I'm sure the netbook sales have soiled the market. They are making this year's per unit growth higher while bringing down the average price per unit. The Apple detesters won't make mention of this new class of PC except to say that Apple should enter this market that offers little to no direct profit, while simultaneously claiming that is Apple is charging too much in this economic crisis.


I am a fan of the netbook for traveling abroad, but I don't think it's a good market for Apple's business model. I have an MSI Wind. It's great. I loaded it with Leopard, but to get the higher-end Atom CPU I had to pay for the one loaded with WinXP. I wonder how much MS got from that license fee? I figure it's pretty low, comparatively, since it is WinXP and the low-end PC market seems pretty content with Linux as the default OS.

I'm still looking forward to getting a new MBP once I am certain that NIVIDIA's inclusion and Apple's new manufacturing process are sound.
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post #24 of 28
Yeah I'm sure when you average out all sales $800 is the median. This report was looking at which segments of the market had the most year over year growth.

It says that netbooks were a major contribution to keeping the US, Europe, and Asian computer sales from being stagnant.
post #25 of 28
Quote:
Originally Posted by TenoBell View Post

That article I linked to said most of the growth in the computer market this year was either below $500 or above $1000.

The majority of people wanted a really good computer or an extreme budget one.

and an extremely portable computer, the netbook.

Apple does not offer one, which is a shame as I am sure there are Apple users who would jump at owning a netbook that could run OSX and their familiar apps.

This is the problem with always needing to wait for Apple to meet your needs, if it ever chooses to do so. I still remember when Apple wouldn't include writeable removable media on its computers, because "Apple knows best".
post #26 of 28
Quote:
Originally Posted by gastroboy View Post

This is the problem with always needing to wait for Apple to meet your needs, if it ever chooses to do so. I still remember when Apple wouldn't include writeable removable media on its computers, because "Apple knows best".

The problem companies who produce netbooks is that they have razor thin margins. Netbooks allow companies to account for a growth in sales but not much growth in profits.

Its also possible they will be a passing fad. I think Apple will see if they actually prove usable in the long run.
post #27 of 28
Quote:
Originally Posted by TenoBell View Post

The problem companies who produce netbooks is that they have razor thin margins. Netbooks allow companies to account for a growth in sales but not much growth in profits.

Its also possible they will be a passing fad. I think Apple will see if they actually prove usable in the long run.

Famous last words.

They are only just starting to catch on and fill the basic needs of many users.

There are also the cloud computers that are now just about to launch for US$100:



http://www.smh.com.au/news/biztech/1...750210764.html

Apple is in real danger of looking like a high priced dinosaur unless it can stay on top of these.
post #28 of 28
Quote:
Originally Posted by gastroboy View Post

Thank you Melgross for that clarification.

You're welcome.
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