Notebook Sales Surpass Desktop Buys - InformationWeek
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6/3/2005
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Notebook Sales Surpass Desktop Buys

Notebook sales in May pulled ahead of desktop buys in the United States, marking the first time laptops have led for a full month.

Notebook sales in May pulled ahead of desktop buys in the United States, marking the first time laptops have led for a full month, a market research firm said Friday.

In overtaking their immobile cousins, notebooks are not expected to return to their second-place status, Current Analysis said. Percentages, however, are expected to remain close, with notebooks consistently remaining a few points ahead.

"You're not going to see 70 percent notebooks and 30 percent desktops," Sam Bhavnani, analyst for Current Analysis, said. "They're going to remain close."

In May, notebooks accounted for 53.3 percent of the total PC retail market, the analyst firm said. It was the first time notebooks led for a full month.

The closest notebooks have come to surpassing desktops was in August 2004, when laptops garnered 49.6 percent of the market, due to intense back-to-school advertising by Toshiba, the research firm said.

Several factors contributed to notebook sales in May. For one, a couple of lesser known manufacturers, Acer and Medion, gained shelf space with low-price notebooks in major retailers, such as Best Buy, Circuit City and CompUSA.

In addition, the overall average selling price dropped 17 percent to $1,131 from $1,370 in May 2004. Desktops, on the other hand, saw only a 4 percent dip to $696 from $728.

Thirdly, consumers have been drawn to notebooks' ability to access the Internet over Wi-Fi connections increasingly offered in public places, such as airports, cafes and hotels. Wi-Fi support has become standard in many notebooks.

A year ago, more than 20 percent of notebooks were sold without wireless capabilities. That number is less than 5 percent today. Plus Intel has dropped the price of its Centrino mobile chips, which have helped drop the price of wireless notebooks. Last year, Centrino laptops started around $1,399. This year, the same computers sell for less than $900.

Put all this together, and consumers "are really looking to purchase notebooks when they're looking for a desktop replacement," Bhavnani said.

Nevertheless, desktops remain considerably cheaper than notebooks, which means they will continue to be favored by businesses with employees who don't work on the road, Bhavnani said. In the consumer market, specialty computers, such as those running Microsoft's Windows XP Media Center, are also expected to keep desktop sales steady. Media Center targets consumers who want to use the PC as an entertainment hub for music and video.

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