DisplaySearch has reported in its Quarterly Notebook PC Shipment and Forecast Report that the notebook PC market grew 27.7% Y/Y to 78.802 million units. At the DisplaySearch US Flat Panel Display Conference in March 2006, John Jacobs, Director of Notebook PC Market Research, forecast that the notebook PC market would grow to 77.943 million units. The actual notebook PC shipment number was just 1.1% higher than the early 2006 forecast, for an accuracy of 98.9%.
In Q4’06, on the strength of unit shipments that surged more than 29% Q/Q, HP once again took the top spot in the notebook PC market with shipments of just under 4.7 million units to capture 20% share of the notebook PC market. The quarter was less kind to Dell, which trailed HP, but perhaps more importantly lost share as unit shipments fell slightly from Q3’06 to Q4’06, despite a notebook PC market that grew more than 14.4% Q/Q.
The other big winner in Q4’06 was Acer, which, like HP, saw notebook PC shipments swell 29% quarter to 3.1 million units, surpassing the 3 million mark for the first time. Acer’s growth narrowed the distance between it and Dell to less than half a million units. Acer’s substantial growth increased its lead over #4 Toshiba, which shipped 2.3 million notebooks in the quarter.
Lenovo also had a strong fourth quarter, shipping slightly less than 2 million notebooks. Similar to HP and Acer, Lenovo also beat the average quarter/quarter growth rate for the notebook market with 18.2% Q/Q growth.
MacDailyNews Note: When contacted by MacDailyNews, Carolyn Lowe, DisplaySearch’s Director of Marketing, shed additional light on the chart above, “Apple went from 1.036M (rounded to 1M) down to 969K (also rounded to 1M) – that’s a 6.5% (rounded to 7%) decline.” Note: that’s calendar Q3 06 vs. Q4 06, not year-over-year. In calendar Q3 05 Apple sold 634K portables, so year-over-year calendar Q3 05 vs. Q3 06 showed an increase of 56%. Apple’s 969K notebook units for calendar Q4 06 were a 65% increase year-over-year vs. 587K units for calendar Q4 05.
While HP led on a worldwide basis, on a regional level, HP held the top spot in APAC and Latin America, as well as EMEA, which it took from Acer in Q4’06. Dell held on to its lead over HP in North America; however its share advantage fell from over 6% in Q3’06 to a 4% lead in Q4’06.
Sony (40.6%), HP (29.4%), Acer (29.0%) and Lenovo (18.2%) all easily surpassed the average Q/Q growth rate for the notebook PC market. By contrast, Toshiba’s gains lagged the market, and Apple, Dell, and Fujitsu/Fujitsu-Siemens were all down Q/Q.
DisplaySearch analysis indicates that the varying degrees of success in Q4’06 between brands are a function of different target markets for each brand. “With an increasing number of PC buyers choosing notebooks for their first PC, and existing PC owners upgrading to notebooks from desktop PCs, a strong retail strategy is critical for success. Indicators of aggressive retail strategies for notebook PCs could easily be seen in the quantity and variety of Black Friday advertisements for notebook PCs in 2006 compared to 2005,” said John Jacobs, Director of Notebook Market Research at DisplaySearch. “Brands that had the most success in 2006 also had a wide range of product offerings during the holiday season, from entry-level to top-of-the-line systems, and often bundled these systems with printers and occasionally flat panel monitors.”
Brands that were hungry for market share were quick to drop the street price premium, even running “free upgrade” promotions encouraging customers to make the transition. Additionally, brands with a heavier reliance on the enterprise market faced the additional hurdle of convincing IT managers to embrace wide products and support additional configurations.
Looking a year ahead to Q4’07, DisplaySearch expects the notebook PC market to continue to surge, growing to almost 97 million units.
Additional details from Q4’06 as well as forecasts by size and resolution are in DisplaySearch’s Quarterly Notebook PC Shipment and Forecast Report here.
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I’m not sayin but I’m sayin: Apple would make massive epic leaps in profit if they were willing to release Parrallels for PC and then
OS X for PCs. This would have everybody loving the OS of Mac but would open the door for Apple to sell the “True OS X experience” for their next computer. In 3-5 years, bam…Apple unseats Microsoft and HP in one fell swoop. Next thing you know, we’re designing decent network configurations that work well with Cisco and BAM…Enterprise market. It can happen you know. Just dream a little.
Andrew Hamilton
Video Production in Las Vegas
http://www.hiproductions.com
Question, did you buy a RAZR when it was $399 new on the market or did everyone seem to have one when it came down to $100? I actually like my RAZR, that it synchs well with my Mac was the bonus. I didn’t buy until the price came down to $100 after rebate. I could have spent the extra hundred or two, but even though I thought it was a good product, I didn’t buy until the price came down to what I thought was reasonable.
Same goes for computers for average people. They see the winblows systems advertised for SEVERAL hundred less than a comparable hardware spec Mac (or worse, better hardware spec for less money such as a 15″ screen with 1gig ram, 160 hd, for less than a mid macbook) and just don’t believe it could be worth the extra money.
I think the opportunity is here, if Apple was able to build a profitable $899 entry level Macbook, to capture a LOT of switcher. At $899 with 1 gig of ram, getting some to look past the smaller screen is easier.
Back when I sold Mac for a living, I sold Quadra 605s all day long for sub $700 (the referbs were as low as $499 plus monitor) and a lot of those were to Windows folks who were willing to take the chance at that price. I also had a lot of people who started out with a 605, and got a better unit 9-12 months later.
Until a Windows user OWNS a Mac, you can show them all the ads, you can tell them how much better a Mac is, you can call them fools for buying a Winblows system… they just don’t know better until they own one.
As a shareholder and a long time Mac fan, I would really like to see Apple leverage their scale to get entry level systems out to the masses.
They don’t charge $399 for an entry level iPod anymore do they? $79 is the minimalist price point now. I say follow that example.
MDN Magic Work, True, as in the truth doesn’t always have to hurt, it could help them grow.
Interesting that even the Asus PCs sell more units than their Mac equivalents.
I guess since a Macbook is an Asus, you guys could claim you have 8.5% share, and a 40%+ increase in market share.
My Apple TV shipped this morning!
Talk of market share all day…Reality and total cost of ownership is that my PowerBook Lombard is still running after 8 years and running Tiger at that. Not speedy, but functional.
It hasn’t sit in a closet, either. It has been to China 3 times(try a 4 hour bus ride on dirt roads sometime) and the daily wear and tear with me to work in a dusty woodworking environment. Market share means squat to me, the user.
Apple may be selling notebook more units than before, but the PC guys are selling even more, hence the continued low market share by Apple.
Apple does not break it out, but without iPod (and the all the cash Apple has invested earning profits) I am thinking that Apple´s computer division barely breaks even. And Apple desktop sales are going down, not up.
Everyone bow down to iPod, the product that keeps Apple going.
For all the hype Apple should be selling many, many more computers.
So all you “4% Apple market share is great” thinkers also agree that the Microsoft Zune´s below 10% market share is superb, too?
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LOL
@Hamilton International Productions said: I’m not sayin but I’m sayin: Apple would make massive epic leaps in profit if they were willing to release Parrallels for PC and then OS X for PCs.
Falkirk: I used to think this was the way too. In fact, I think the traditional thinking is that the big mistake Apple made was that they did not realease their OS back in the 90s. But now I think that Mac has a very different strategy and that this strategy is going to be tremendously successful soon.
Apple DOES NOT WANT to have it’s OS run on non-Apple computers. There are several reasons for this. First, one of the things that makes Macs uniques is the integration between it’s software and it’s hardware. And the limited number of Mac configurations allows for rapid Software and OS releases. And the unique combination of Mac hardware and OS allows for Mac to create software that is uniquely suited to the Mac.
Second, Mac makes it’s money on hardware, not software. It practically gives Ilife aware for free. If Apple released it’s OS to run on PC boxes, it would be seling it’s OS in direct competition to Microsoft. While you may think the superior OS would win, remember that Microsoft has long standing contractual relationships with most PC makers and essentially has locked up the OEM market. And again, would the Mac OS be superior to Microsoft if it had to be configured to all of the PCs, especially the minimum configuration PCs, now in existence?
I’m going to sound like a broken record, but again, I highly reccomend the articles published by Roughly Drafted. Their analysis is amazingly insightful.
To visualize the market share more graphically, out of every 100 notebook computers sold today…
96 will be Windows:
W W W W W W W W W W
W W W W W W W W W W
W W W W W W W W W W
W W W W W W W W W W
W W W W W W W W W W
W W W W W W W W W W
W W W W W W W W W W
W W W W W W W W W W
W W W W W W W W W W
W W W W W W W W W W
4 will be Apple:
A A A A
In the final quarter of 2006, Apple earned $7.1 billion in revenue, compared to Microsoft’s $12.5 billion in total revenue. Yes, that’s right, Apple brought in more than half as much money as Microsoft, despite Windows owning 98% of the PC market.
Even stripping Apple of its iPod revenues, which PC pundits love to do, the company still earned $4.4 billion on its Macintosh business, over a third as much Microsoft brought in from its entire Windows, Office, and server operations combined. Apple’s 2% of the PC market doesn’t seem so small anymore.
http://www.roughlydrafted.com/RD/RDM.Tech.Q1.07/9E601E8E-2ACC-4866-A91B-3371D1688E00.html
I have had experience with only one Sony laptop. A 17″ behemoth that while good-looking on paper has not proven to be so in real life. Of course, Windows XP has a lot to do with that, but also, all the crapola that comes pre-loaded on the machine is very disturbing.
If the manufacturers would ship a Windows XP only version of their laptops that would go a long way to saving Windows users with half the issues they have to deal with, but of course how else would Sony then market themselves if the computer didn’t include the mandatory “Vaio Power Managent, ” “Vaio Help Desk” and such applications?
No matter how good their laptops look, HP has some nice ones too, if they have Windows in them and it isn’t a clean copy of it, then they just don’t work as well as the Mac.
@Falkirk—-sigh, this article is about market share not profits. It is not about Microsoft vs. Apple, but Apple vs. other PC makers. (Yes, I realize they run on Windows (so can Apple computers), but that is not what this article is about.)
You use of the term “earned” is mistaken. Usually when the word earned is used it means profits. Apple may have had revenue of $4.4 billion (I assume your figure is correct), but we do not know what the profit was on all that revenue.
Apple´s computer sales should be much higher. But because of market forces unfortunately it is doubtful that Apple will ever get a double-digit market share. It would take an outside the current market force or event (such as Apple has a totally new proprietary technology – like the iPod or iPhone) to change the computer market share dynamics. Right now I don´t see it happening. Apple sales will surely grow, but unfortunately they do no grow fast enough and notebook sales are cannabalizing desktop sales at Apple.
@Market Forces, a well thought out response. However, I cannot agree with your conclusions. I cannot seem to paste this chart, so I’m pasting a link to it:
Unfortunately, the chart does not include the underlying percentages. Nevertheless, if you view the chart you can see that even the largest PC makers only hold a miniscule portion of the total PC market. The PC market is huge. But the Mac is skimming the cream of that market. They are appealing to high end users who can afford high end computers/laptops.
The Mac will never be Ford or GM. I don’t think they’ll even be a Honda. I think they want to remain the high end Lexus with small total market share but domination of the high end market.
The chart I linked doesn’t appear to be working. I guess the best I can do is link the entire article:
http://www.roughlydrafted.com/RD/RDM.Tech.Q1.07/FFE4A8E2-9816-4344-9FB0-61BED246674C.html
@ Falkirk: No, Lexus doesn’t try to canibalize it’s luxury niche by offering cheap cars. However, its parent company – Toyota – offers cheap cars right and left. And offers more expensive cars within the Toyota brand itself. In fact, its reasonable to say that Toyota wouldn’t be the preeminient car maker it is today if they didn’t have offerings at all pricepoints. And that’s all I want Apple to do.
Jobs has said in the past he’s happy running the BMW/Porsche/Ferrari of the computer world. And that was fine in the days when he had no realistic shot of appealing to an audience any wider than that. Those days are gone now. Apple could be mainstream practically overnight, if they’d only start offering cheaper products. In the car making world, you’ve got so many players that there’s plenty of decent Fiats/VWs/Hondas to buy if you don’t want/can’t afford a Lambo or Benz. But in the computer world it’s either Apple or M$ (or Linux, which is more like a kit car) – which is like saying Ferrari or American Motors (google “AMC Gremlin” to see what I mean).
Maybe Apple really doesn’t want the success of being the biggest OS on the planet. Seems stupid to say, but I don’t know. Yet even if that’s true, it doesn’t matter to me because, frankly, the planet NEEDS a better, widespread alternative. Society would thank them for providing the option if nothing else, and Apple would make a bundle in the process.
Time for them to get moving.
MDN word = “million”
Ha! I love irony.
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@Odessy67
I don’t think Toyota sell cheap cars. They don’t compet with Yugos. Thier “low end” cars are still in the mid price range (I think).
Price communicates value. Lowering your price communicates that you are selling a lower value item. Do expensive watchs cost that much more to make than cheap watches? Do high end Sony televisions cost that much more to make than cheap knockoffs? When you become a commodity, you compete only on price. When you have a unique attribute, you compete on value.
@Falkirk – RE: Toyota and low priced cars; guess you have not seen all that they offer.The cheapest Toyota – which is in the same price category of all budget cars- the Yaris starts at over $11,000.
(When was the last time you priced a new vehicle?)
And your comment about the Yugo.
The Yugo has not been available in the US (or anywhere) for a long time – stopped US sales in about 1989!
See the complete price range of US Toyota´s here:
http://www.toyota.com/vehicles/modelselector/index.html?s_van=GM_TN_CARS
——————
A product does not have to become a commodity just by low price. Apple ipods cost $79, are they a commodity? (It would be interesting to see what % total sales the $79 ipods are.)
Personally, I think Apple has done its market research on this and found that no matter what low price they would offer their computers the vast majority of Windows users would not switch. So they have said the hell with it and will stick to the 5% of market share.
@Falkirk——
I hope Apple never becomes a Ford or GM – losing market share over the years, teetering on bankruptcy.
LOL.
I don´t think one could say that Apple is going after the “high end” market. I would say more they are going after the luxury and high fashion market. (I define high end as more performance oriented, plus luxury and high fashion. Apple computers have basically the same hardware guts as any PC. A BMW has a BMW engine in it – no other car company has that. Apple has the same processor as every other PC out there. Nothing special or high end about it compared to the competition.)
A big draw of the Apple is it is cool. A big negative is that window´s owning people perceive it to be more expensive….plus they don´t want to hassle with changing to a new system and fear of having to invest in new software.
Unless Steve can develop some new technology paradigm shifting hardware to include only in Macs, then it has to be happy with its BMW-sized market share.
@Ted the Turnip Puller:
As you can see, I have no idea what cars are going for. I’m in the (sigh) mini-van stage and I always buy used. That fact alone probably disqualifies me having any viable opinion on business and economics.
I just pulled Yugo from the depths of my mind. Shows you hold old and out of it I am.
“@ Falkirk: No, Lexus doesn’t try to canibalize it’s luxury niche by offering cheap cars. However, its parent company – Toyota – offers cheap cars right and left.”
You can regard Lexus as just a really expensive Toyota.
A Mac is just a really expensive HP.