market share

As expected, according to IDC, iPad sales declined 13% year-over-year while the tablet market grew 7%. That’s bad for Apple. Part of it is the longer replacement cycle; another is that iPads are not competitive with “good enough” Android tablets that cost substantially less. But this is a story we’ve explored before on the Cornerplay.

What’s more interesting is Windows 2-in-1 hybrid devices, which IDC reports at 4% of the market while pure Windows tablets are just 0.6%. That means 2-in-1s are 87% of all Windows tablets.

While those are tiny numbers, Windows tablets grew 67% in an environment where iPads actually declined. IDC expects this forward momentum to continue, and for Windows to achieve 11% market share by 2018.

What do we think? Predicting technology is like trying to thread a needle on top of a speeding train, but we’re up for the challenge.

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I previously wrote how Microsoft and PC makers should be concerned about Mac computers, which saw record growth the previous quarter and will likely see continued growth. However, there’s chatter on the blogosphere that is taking the “Mac is destroying PCs” narrative too far.

Charts like this get posted:

Provocative, but very misleading.

This is probably more representative of the big picture:

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The extraordinary thing about Macs is its ability to convert sales into profit — no other computer manufacturer does it as well as Apple. For every $100 worth of computer that Apple sells, Apple makes $19 of profit whereas competitors are lucky to make $4. That’s more than 4x the margin, which is amazing.

PC makers feel the sting, but Macs still comprise less than 7% market share so Microsoft hasn’t felt the same kind of pressure. The Redmond company soon will, however. In Apple’s latest quarterly report, Macs grew 21% compared to the previous year’s quarter, over a time when the overall PC market is flat. Apple hasn’t done as well since 1995.

Apple has traditionally focused on the high end market; but more and more, Apple has been willing to compete in the middle. That’s why Apple is still selling the the non-retina MacBook Pro, the original iPad mini and the iPhone 5C, even though those products aren’t likely to garner the same high customer satisfaction scores that Tim Cook often brags about.

While Mac units shipped grew 21%, revenue only grew 18% — evidence that the average selling price of Macs sold has declined. This is a signal that Apple intends to grab market share.

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