Laptop Market – Flight To Quality? – The ‘Book Mystique

Preliminary quarterly PC shipments data released by Gartner Inc. last week reveal an interesting disparity between sales performance of major name PC vendors as opposed to that of less well-known brands.

Bucking a fifth consecutive year of worldwide general PC shipment decline, older established PC makers HP, Lenovo, Dell, and Apple all managed to achieve growth in both worldwide and domestic markets, against a backdrop of a 3.7 Percent decline in global PC shipments year-over-year in 4Q16, during which Acer shrunk 4.4 percent, Asus 8.5 percent, and “Others” a whopping 18.8 percent.

In the U.S. domestic PC market, while Acer logged very respectable 11.2 percent growth, indeed beating second-place Lenovo (+8.4 percent) handily. However Asus U.S. sales cratered spectacularly, down 48.4 percent from 4Q16, although it was tied with Apple in fourth place market share worldwide, and beat Apple by about two million units shipped in 2016.

Apple managed 6.4 percent domestic growth and 2.4 percent globally on the year with global and domestic market shares of 7.5 percent and 12.8 percent respectively. However, as usual the Mac-maker was eclipsed by perennial PC market leaders HP (29.9 percent domestic share; 20.4 percent global) and Lenovo (25.2 percent domestic share; 21.7 percent global) in both markets.

“Stagnation in the PC market continued into the fourth quarter of 2016 as holiday sales were generally weak due to the fundamental change in PC buying behavior,” noted Gartner principal analyst Mikako Kitagawa in a press release. “The broad PC market has been static as technology improvements have not been sufficient to drive real market growth.”

However Kitagawa does note some bright spots in the generally gloomy laptop picture, saying: “There have been innovative form factors like 2-in-1s and thin and light notebooks, as well as technology improvements, such as longer battery life. This end of the market has grown fast, led by engaged PC users who put high priority on PCs. However, the market driven by PC enthusiasts is not big enough to drive overall market growth.”

And therein may lie the explanation of the disparate sales performance between the major brand names and the “Others.” The “PC enthusiasts” who would include professional and tech aficionado power users, are less price-resistant than “consumer” users, and tend to gravitate more toward quality. Theoretically, that should serve Apple well, and may also partly explain why Apple jacked the prices of the late 2016 MacBook Pros sharply and appears to have largely gotten away with it.

However, Apple hardware build and materials quality is being more closely matched these days in high-end windows PCs, and arguably the latter have broken out in front of Apple in terms of design and innovation.

Viewed from that perspective, Apple is doing reasonably well with laptop sales, considering that it has neither touchscreens nor hybrid 2-in-1 laptop/tablet convertibles — the currently hottest laptop categories — on offer, unless you count the iPad Pro with optional keyboard, which most serious productivity/power users don’t, and/or think the MacBook Pro Touch Bar is an adequate substitute for real touchscreen support, which apparently a sizeable cohort of purchasers do.

Moreover, Chinese-language Economic Daily News (EDN) report last week cited unnamed insider sources in the upstream supply chain predicting Apple MacBook shipments to grow 10 percent in 2017, and projecting 15 million units shipped.

However, the competition from the PC/Windows side is getting stiffer in terms of both build quality and practical features content, with machines like HP’s Spectre models, Dell’s professionally focused XPS 13 and XPS 15, Microsoft’s own Surface Book 2-in-1, Lenovo’s Yoga, and many others.

For example, while a leading complaint about the late 2016 MacBook Pros and the 12-inch MacBook is their compromised “butterfly” keyswitch keyboards that many users say they find noisy and uncomfortable for long-form typing. What’s particularly frustrating about this is that HP has proved comfortable keyboard action is not incompatible with ultrathin laptop engineering. Their new 13.3 inch Spectre copper Ultrabook is thinner than the MacBook with retina display, but by most accounts is deemed to have extraordinarily comfortable key action.

The 13.9mm thick, 2.89 lb HP Spectre x360 2-in-1 starts at the iPad-esque price of $749.99, is powered by 7th generation Intel Core processors, offers a claimed up to 16GB of RAM 15 hours of battery life1, supports up to 16GB of RAM, and faster PCIe storage, has two USB Type-C ports and a legacy USB 3.0 Type-A port, Bang & Olufsen audio, aluminum unibody construction, and is available in your choice of Natural Silver, Ash Silver, or very classy Copper finishes.

HP’s EliteBook Folio, touted as “the world’s thinnest and lightest business-class notebook,” starts at a modest $979.00 — cheaper than the entry-level MacBook Pro without Touch Bar.

Dell claims its 2.7 pound XPS 13 is the world’s smallest 13-inch 2-in-1, featuring a 360-degree hinge for multiple form factor modes, up to 15 hours battery life and a QHD+ (5.7M pixels) InfinityEdge touch display with 3200×1800 resolution and 5.7 million pixels (276 ppi). The XPS 13’s fan-less design keeps it silent, ano for business users, the XPS 13 2-in-1 can be configured with 7th Gen Intel Core vPro processors and Dell BIOS and manageability software — backed by Dell’s global ProSupport services. The XPS 13 2-in-1 is built with machined aluminum, carbon fiber, bonded Corning Gorilla Glass NBT, steel hinges wrapped in machined aluminum for stronger construction, a display up to 10 times more scratch resistant than soda lime glass and a carbon fiber palm rest that is cooler to the touch. The optional Dell Active Pen with thousands of levels of pressure sensitivity offers pro-level precision in tablet mode. The standard fingerprint reader provides password-free sign-in with Microsoft Hello.

Dell’s updated its XPS 15, claimed to be the smallest 15.6-inch laptop on the planet, has 7th Gen Intel Core processors, NVIDIA Pascal architecture – GeForce GTX 100 graphics, an InfinityEdge display, and a fingerprint reader for password-free logins via Windows Hello with a finger swipe. This is a 15-incher closer in footprint size to a 14-inch laptop, thanks to a bezel measuring just 5.7mm (59% thinner than the Macbook Pro).The new XPS 15 retains legacy ports and a SD card reader as well as adding a USB-C compatible Thunderbolt 3 port. While the MacBook Pro is limited to 16GB of RAM, the XPS 15 maxes out with support up to 32GB. You can even order an XPS 15 with a hard disk drive instead of an SSD. Dell XPS 13 2-in-1 is available exclusively on Dell.com and at Best Buy in the U.S. starting at $999.99

The new Microsoft Surface Book, introduced last fall the day before Apple unveiled the Touch Bar MacBook Pros, is a attractive package showcasing real, practical innovation, and is currently starting at $1,349.00 with a Surface Pen stylus included.

Clearly, Apple’s traditional edge in laptop quality and innovation has eroded, and if a flight to quality and innovation is underway, its laptops are no longer the no-brainer choice.

Note that Gartner’s data include desk-based PCs, notebook PCs and ultramobile premiums (such as Microsoft Surface), but not Chromebooks or iPads. All data is estimated based on a preliminary study. Final estimates will be subject to change. The statistics are based on shipments selling into channels.

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