This is a view of the market statistics published today. Note the last paragraph:
"Dataquest also estimated some stability in prices for 1999, with less dramatic declines than in 1998. "What that means is the growth rate in units shipped starts to sync up with the growth rate of revenue, which is very good news"
From "helpinout"
Compaq Tops PC Market
(01/29/99, 2:09 p.m. ET)
By Joe Wilcox, Computer Reseller News
Compaq rallied, despite difficulties, to top both the worldwide and North American PC markets for 1998.
According to preliminary numbers released Friday by Dataquest, in San Jose, Calif., Compaq had a 13.8 percent worldwide market share and a 16.1 percent share in the United States. This represents 20.7 percent and 13.3 percent growth, respectively, over 1997.
William Schaub, vice president of Dataquest PC Computing, called the Houston-based PC maker's showing impressive considering its focus on digesting Digital Equipment and "the huge issues of days of inventory in the channel in the U.S."
But the numbers reflect sales into the channel, rather than out, the metric Compaq switched to following first and second quarter 1998 inventory problems.
"I think our focusing on sales out of the channel as a key metric is important," said Earl Mason, Compaq's chief financial officer. "I think it's important to the industry, and I know the channel guys like it. It's an important shift to measure the overall market-share growth for the industry."
In fourth quarter financial results announced Wednesday, Compaq estimated year-over-year worldwide growth of 43 percent, as sales measured out of the channel. Growth in North America was 53 percent as measured out of the channel.
Schaub defended the decision to measure sales in for indirect vendors and to the customer for indirect companies.
"At some point, you could sit there and make some argument [that] sales out is the only thing that is important," said Schaub. "But what we were really looking at is the financial results of a PC company in a quarter [that is] truly the result of the production of the PC and its sales." However, he also hinted that increased efficiencies by Compaq and other indirect players could lead to a change in the metric.
IBM, in Armonk, N.Y., took the No. 2 position worldwide with an 8.2 percent market share. But Dell nipped its heels with a 7.9 percent share. Dell grew at a higher rate compared with IBM and others. The Round Rock, Texas-based company gained 64.9 percent over 1997, compared with 9.5 percent for IBM.
Fourth-ranked Hewlett-Packard also showed robust worldwide growth, gaining 25.5 percent over 1997 with a market share of 5.8 percent. Packard Bell-NEC followed with a 4.3 percent share, but had negative growth of 4 percent.
In North America, Dell gained 60.9 percent over 1997, taking the No. 2 position with a 12.7 percent share. Gateway followed with an 8.4 percent market share and growth of 38.4 percent.
Gateway made its way into the top five because of its strong third and fourth quarter performance, Schaub said.
IBM took the fourth spot in North America with an 8 percent share and growth of 10.1 percent, followed by Palo Alto, Calif.-based HP with a 7.5 percent market share and stronger growth of 37.1 percent.
Apple failed to break into the top five either worldwide or in North America, but earned meritorious comments from Schaub.
"In discussing Apple going forward, the next two quarters become critical as they have captured the pent-up demand of Apple users," said Schaub. "Going forward, we need to find out whether some of their strategies, their Internet strategies, broaden the appeal of Apple beyond their existing Macintosh family."
Several trends emerged from the results involving consumer and commercial PCs, notebooks, and ultra-portables. About 37 percent of U.S. households are online, but the numbers are not large enough to reach the critical mass needed to make the Internet a must-have commodity. Women are now the No. 1 users of PCs in the home.
On a cautionary note, Schaub said there is now in the United States a saturation of PCs used by people "each day and all day. Those seats have all pretty much been taken up. So we are truly at a replacement stage for that portion of the market."
The challenge for the commercial marketplace, Schaub said, "is to have the kind of double-digit growth rate the industry expects. We need to find ways and methods to maybe step up the replacement cycle."
Dataquest also estimated some stability in prices for 1999, with less dramatic declines than in 1998. "What that means is the growth rate in units shipped starts to sync up with the growth rate of revenue, which is very good news," Schaub said.
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