Apple owns the market on expensive PCs

According to a new study from NPD, 91 percent of PCs sold for over $1,000 at retail in June was a Mac. Does this fit right into Microsoft's recent ad campaign?

More good news for Apple this week: if consumers are going to buy an expensive computer, they're choosing the Mac maker.

That's according to the June tally of the PC market from The NPD Group. According to NPD, 91 percent of all computers sold at retail for more than $1,000 were Macs. That marked a slight increase from the 88 percent in May. But Apple officially owns that market, and it appears the price cuts across its MacBook Pro lineup introduced in early June helped. On Tuesday, Apple announced that it sold 13 percent more Macs during April, May, and June of this year than the same period a year ago, despite the recession and price-conscious consumers.

Of course, all the computers Apple sells--with the exception of the $999 white plastic MacBook--are more than $1,000, so they should own that market. NPD's numbers do not include specialty gaming PCs that enthusiasts usually customize and buy online, which can be well over $1,000. But, as NPD analyst Stephen Baker points out, two-thirds of all computers are sold at retail, so the numbers paint a comfortably accurate picture of what's going on in the PC market.

Windows PCs on average sell for much cheaper now because of the increased focus on price point aided by the Netbook phenomenon. The average selling price for a Windows PC at retail in the U.S. was $515, and for Macs it was $1,400.

That would seem to justify Apple COO Tim Cook's comments on his company's earnings call earlier this week, where he pretty much said Apple would never make a Netbook because the company doesn't think it can make a quality notebook for $400 or $500. ("We're going to focus on what we've always done. The Mac has outgrown market in 18 of the last 19 quarters. I think that says that we do have the right approach.")

Or do they?

While Apple's overall business is indeed humming along, NPD's Baker thinks that based on the data, it's not sustainable for the Mac business to refuse to go lower than $999.

"Regardless of the value proposition, the trend in consumers is they want to spend less money. But Apple is gaining more and more share in a segment ($1,000-plus) that is not likely to grow," he said.

Until the cheaper MacBook Pros came out in June, retail data in the U.S. showed Apple notebook sales growth was actually declining from February through May, which helps explain the price cuts.

But Baker believes that even if Apple doesn't do a Netbook, "sooner rather than later" Apple will need to come down to $799 for its lowest-end notebook if it wants to continue to grow its market share. And, he says, there's precedent at Apple in this area.

"They know how to do this...with the iPod, they continually cannibalized themselves, strategically bringing out new (iPod models) to cover all relevant price points," he said, referring to the expansion from the early iPod Classic to the inexpensive iPod Shuffle. "They're very, very good at this."

This article was originally posted on CNET News.

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