While Apple routinely crows about its heady Mac sales growth numbers, the Cupertino computer maker also conveniently ignores one important fact: It has never exceeded 4 percent worldwide market share in the past decade. And with PC market share results in for the most recent quarter from both IDC and Gartner, Apple has another inconvenient truth to deal with: It actually lost market share, even in the United States, its most successful market.
The reason for Apple's stagnation in the PC market is simple: Macs are too expensive, and today's bestselling computers sell for about one-third the cost of mainstream Macs. "If a company is not in the low-priced market, it's absolutely difficult for it to increase market share," Gartner analyst Mikako Kitagawa said. "And Apple did not do as well as others in share because of its prices."
IDC concurred. "The US \[PC\] market exploded in the fourth quarter ... with new low price points to stimulate demand and face competition," said IDC research manager David Daoud. "Apple did nothing of the kind: Although it refreshed the iMac desktops and the low-end MacBook in October, it did not follow other computer makers and drop prices during the quarter."
Dropping prices, of course, is not in Apple's DNA. The maker of "the computer for the rest of us" has almost always exclusively targeted the high end of the market, a strategy that has generally paid off well since Steve Jobs' return to the company in late 1996. But the economic downturn has finally hit home for Apple. Though the company's Mac sales in the fourth quarter were strong, growth couldn't keep up with the wider industry, where PC sales jumped 25 percent in the fourth quarter.
The Mac deficit shows up both worldwide and in the United States, and when compared to the previous year and the previous quarter. (Market share is generally compared to the same period from a year earlier.) In the third quarter, when the Mac commanded 9.1 percent market share in the United States, Apple fanatics crowed that the company was closing in on 10 percent. (Many simply describe Mac market share, erroneously, as "about 10 percent.") But this past quarter, the Mac garnered just 7.4 percent of all PC sales in the United States. (It was 7.5 percent in the same quarter a year ago.) And worldwide market share, as always, was under 4 percent.
This reality is contradictory to Apple's aggressive advertising and product promotion and the stance of the company's staunchest defenders. And while the IDC and Gartner market share estimates may be off a percentage point or two—Apple will deliver its actual Mac shipment numbers in about ten days—we'll soon be able to calculate the official results for the fourth quarter of 2009 and calendar year 2009. (I will publish these results, as I have for years, on the SuperSite Blog.)
While Apple's continued inability to make a serious dent in the PC market is nothing new, this news will paradoxically surprise many people. It shouldn't: While Apple has steadily made small gains in the United States and very small gains worldwide each quarter, the Mac has never reached the upper echelon of PC sales in any market over the past decade.
None of this overshadows Apple's influence over the tech industry, however. And there is reason for that influence. The company's iPod players are dominant in the MP3 player market and are the standard by which all other devices are measured worldwide. Apple's iPhone is incredibly popular in the consumer smartphone market (in the United States especially), and is growing at an amazing clip. It's hard to overstate the influence this device has had on smartphones from device makers around the world.
And while the Mac may have plateaued, it is important to realize that the Mac is actually quite successful regardless. Yes, PC makers ship about 300 million PCs worldwide each year, and, yes, the Mac represents just a tiny portion of that number. But the Mac still generates millions in revenues each quarter for Apple. That's nothing to sneeze at, and when you factor in the success of the iPod, iPhone, and iTunes Store, you see an influential ecosystem that will likely continue to pull people into the Mac fold going forward.
So let's not get crazy. We're not reading the Mac's obituary here, far from it. But maybe it's time to be a bit more realistic about where this product fits into the wider scheme of things