From: technews <technews@ou.edu>
To: "'it-fyi@listserv.ou.edu'" <it-fyi@lists.ou.edu>
Subject: it-fyi: Apple's iBook tops notebook sales (news.com)
Date: Tue, 23 Nov 1999 09:28:54 -0600
Apple's iBook tops notebook sales
By Jim Davis
November 22, 1999, 6:05 p.m. PT
http://home.cnet.com/category/0-1006-200-1462026.html
Despite some worrying shortages, the iBook laptop is turning into a winner
for Apple Computer and helping the company expand its retail presence.
For the month of October, the iBook was the single best-selling notebook
at the retail, online and mail-order sales outlets, according to PC Data,
besting offerings from the likes of notebook stalwarts Compaq Computer,
Toshiba and IBM. The figures do not count sales from "direct" PC makers such
as Dell Computer.
Apple last month nearly doubled its overall market share to 11 percent,
up from 6.5 percent in the previous month. The total includes sales of its
PowerBook line of computers. Nonetheless, Apple's growth surmounted severe
product shortages resulting from a lack of screens and a disruption in
production due to the Taiwan earthquake in September.
The Cupertino, Calif., company still has a long way to go in the
notebook market before it overtakes Compaq or Toshiba in terms of overall
market share, said Stephen Baker, senior hardware analyst for PC Data, but
the company is clearly making headway.
"There's a definite opportunity in this [notebook] market," Baker said.
"Apple had a long run with the original iMacs and found niches they could
exploit. That's what this product is going to do, not [help them] pass
Compaq or Toshiba in the near future."
Overall, Compaq remained at the top of the notebook heap with 27.5
percent market share, followed closely by Toshiba with 26 percent market
share. IBM was third with 15 percent.
The preliminary results seem to show that Apple's renewed emphasis on
design has made the same kind of impact in the notebook market that the
original iMac did in the desktop market. That model stayed at or near the
top of the sales charts for months after its initial introduction in August
of 1998.
"Customer response has been incredible, and we are working hard to meet
the tremendous demand," Steve Jobs, Apple's interim CEO, said in a
statement today.
Notebooks have always been hard to display in stores because they have
to be locked down, Baker said. An interesting or colorful design helps the
product stand out from the competition in this situation. The iBook takes
its design cues from the iMac and comes in two colors--blueberry or
tangerine. It comes with a clamshell lid, a carrying handle, and built-in
antennae for wireless networking, among other features, for $1,599.
Sony first struck gold with a formula of mixing panache with the
notebook to win market share. Last year, Sony was a scrawny player with
less than 1 percent of the market, but the company is now the
fourth-largest notebook maker in the retail market with 13.9 percent, a
surge that it owes to the success of its slim Vaio notebooks. Meanwhile, Big
Blue has tried to shed its conservative image--and boost sales--in the
retail market by offering notebooks with snap-on colored covers.
Unfortunately for Sony and Apple, the U.S. retail notebook market
accounts for a smallish portion of the overall PC market. Retail sales
account for about 30 percent of the total U.S. PC notebook and desktop
market, and about 10 percent of total worldwide market, according to various
industry figures. The main part of the market is in sales to corporations,
where the duo still lag.
Apple fans pre-ordered hundreds of thousands of iBooks before the first
units ever shipped. Many of those fans found themselves getting antsy as
notebook and even desktop computer supply problems persisted.
Until recently, Apple was lagging in shipments to the retail market
because of a number of issues that led to lower-than-anticipated earnings
last quarter. Availability of iBooks was mostly affected by component
shortages and natural disasters that have resulted in an unusually severe
shortage of iBooks, a situation partly shared by all major notebook makers.
Component shortages have caused companies such as Dell and Apple to
strike strategic agreements to ensure a steady supply of screens, one of the
main sticking points so far. Dell is investing $200 million in Samsung
Electronics to ensure it will get about $8.5 billion in displays over the
next five years. Apple made a similar investment in July. Analysts think
most other companies will follow suit soon if screen supply doesn't
improve.
It is not known how many of the pre-orders for the iBook were eventually
posted to retailer's sales tallies during October, but Baker thinks that
most of October's orders were "real sales," meaning that a customer got to
take the product home.
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