The desktop PC market in the US and Europe ended 1998 on a high note, according to analysts, and 1999 looks just as promising.
IDC and Dataquest both released reports on desktop PC sales figures for both the fourth quarter of 1998 and the full year on Friday - and while each report differs in detail, they demonstrate the same overall trends.
Compaq was clearly back as number one in both the US and international markets, while Dell became the undisputed number two in the US and was seen to be closing on IBM internationally.
Interestingly, Dell has lost some ground in the US since the second quarter of 1998, when it owned a market share of 14.3 per cent. In the second quarter, it was neck and neck with Compaq, which at the time was suffering from inventory problems and merger related distractions, but by the fourth quarter, Compaq had reestablished a commanding lead.
Its position in the US market is now only just barely down on a year ago, and its world wide market share actually improved.
Christine Arrington, an analyst with IDC, said: "Dell doesn?t have a strong consumer market yet," but she believes it is too soon to conclude whether Dell?s historic stellar growth pattern is starting to level off.
"I think their sequential market share loss has more to do with seasonality," she explained.
Compaq?s 1997 and 1998 figures have both been adjusted to include sales from Digital Equipment?s PC division, which the hardware giant acquired last year.
According to IDC?s fourth quarter figures, Compaq held a 15.4 per cent market share, up from 15.2 a year ago, while IBM had a 9.7 per cent share, down from 9.8 per cent.
Dell cornered 8.4 per cent of the sector, up from 6.2 per cent last year, while Hewlett Packard (HP) was in fourth position with 6.1 per cent, down from 6.2 per cent.
For the full year, the ranking was much the same, although it showed IBM in a much weaker second position.
Big Blue made a marked comeback onto the US market in the latter half of 1998, however. After dropping out of the top five in the second quarter, falling behind even the moribund Packard Bell NEC, it still managed to grab the number four position for the full year ? even though Gateway overtook it to claim third position.
But Apple did not make it into the top five for the fourth quarter, despite strong iMac sales, coming in seventh.
Arrington also said the inventory problems that had plagued many of the major players in the first half of 1998 had now largely dissipated, with vendors taking much greater care not to overstock the channel.
But she added that 1999 was looking like another strong year for the PC market. She predicted a 12.8 per cent growth rate in PC shipments, up from 12.1 per cent last year, but believed that growth would be concentrated in the first two quarters of 1999, after which time the Year 2000 problem would start to impact sales.
The decline in average PC selling prices is likely to continue, but at a slower pace than in 1998, however.
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