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Summary:

A lot of stories like this one are circulating about how NPD is saying Apple has a 91 percent market share of all PCs sold over $1,000. They give that impression by claiming something like “a 91 percent share”, or “91 percent of the market”. Truth […]

A lot of stories like this one are circulating about how NPD is saying Apple has a 91 percent market share of all PCs sold over $1,000. They give that impression by claiming something like “a 91 percent share”, or “91 percent of the market”.

Truth be told, if NPD really stated this as market share, I’d say they were wrong. It’s hard to believe 9.1 out of 10 PCs over $1K are Apple’s. Come on, people, there are many non-Mac users who spend money, too. Whether for quality, style, or higher-end components, not everyone who gets a PC is a Laptop Hunter. I’ve never bought a Windows machine for under $1K in my life, and I’ve had many.

It doesn’t take much to refute the market share angle. I don’t agree with the article using just Best Buy as a point of comparison, but it’s still not hard to believe there’s no such ratio of Macs to PCs at the high-end.

But if not market share, what is NPD talking about? Let’s look at this as reported by Joe Wilcox (with a headline as misleading as the others):

According to NPD, in June, nine out of 10 dollars spent on computers costing $1,000 or more went to Apple.

Nine out of 10 dollars went to Apple? That’s a different beast than market share. It’s revenue share, and a lot more believable.

Consider the example where two people go to a Best Buy. One buys a PC for $1,045, the other a Mac for $1,455. At this point the Mac and PC market share is equal (one each, 50 percent). But now let’s look at the “dollars spent on computers costing $1,000 or more”, which total $500. PC got $45 (9 percent), while Mac got $455 (91 percent).

Is it believable that Macs, with an Average Selling Price of $1,400 in June, could hold that kind of ratio against PCs with an ASP of $515 the same month? I believe so.

Honestly, though, this is one of those statistics that sounds cool, but doesn’t really tell us much. By picking an arbitrary cutoff ($1K) it’s statistical juggling. What if the Mac cost $1,200 to make, and the PC $800? Apple would have that flashy 91 percent number, but only net 10 more bucks than the PC from the deal.

Which brings me to what matters. Ultimately, it’s about profits. Units sold, share of this category or that, supposed web usage figures by tracking browsers, etc., all make for interesting headlines. But where is the money? Microsoft and PC vendors have made plenty in the past despite their lower ASPs. They simply sell a lot more boxes (Apple is still under 4 percent globally). That’s why, to me, the real story this week is Apple’s stellar earnings report from Wednesday compared to Microsoft’s dismal results from Thursday. That’s more revealing than a 91 percent share of anything.

  1. “Consider the example where two people go to a Best Buy. One buys a PC for $1,045, the other a Mac for $1,455. At this point the Mac and PC market share is equal (one each, 50 percent). But now let’s look at the “dollars spent on computers costing $1,000 or more”, which total $500. PC got $45 (9 percent), while Mac got $455 (91 percent).”

    Talk about statistical juggling…you could have just told a knock knock joke, this isn’t math, statistics, profit analysis, or any type of scientific measure at all.

    I am not even sure what I am supposed to get out of this other than if you find a PC for one price, and an Apple for another, it gets you to that 91% number in a meaningless way.

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    1. Jason,

      Ultimately, that was my point. It isn’t 9 out of 10 PCs, but 9 out of 10 dollars over $1K, but even then it’s a statistic of little value.

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  2. Your math is still wrong though… If that quote is correct, it’s not about each dollar spent OVER $1000, it’s about ALL dollars spent on computers that cost over $1000. In your example you said “PC got $45 (9 percent), while Mac got $455 (91 percent)” but in fact, PC got $1045(41 percent) and Mac got $1455(59 percent). Still a big difference, but not as huge as you make it seem.

    The really big problem with these stats is that they only count “big box” RETAIL sales. Tons of people who buy computers over $1000 either build them by hand, order them custom online, or go to local “mom and pop” computer shops and get specialized builds.

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  3. Um, no. This is “dollars spent on PCs costing over $1,000,” not “the portion of each sale over $1,000.” $1,045 vs $1,455 is 42/58%.

    It’s still a skewed number, but I think that has more to do with purchase patterns. Apple rules prosumers, who are the only segment consistently buying expensive computers at retail. To generalize, low-end consumers buy cheap machines, businesses buy online, and gamers buy components instead of assembled systems.

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    1. Dan (and Matt),

      I read the quote as drawing the line at $1K and looking at all the dollars above it. That’s still how I see it, though it is a bit ambiguous.

      If I read it the way you two want to, then it’s right back to nine out of every 10 $1K+ PCs are Apple’s, which I think is refuted almost via empirical evidence.

      I think what we DO agree on, however, is that the statistic either way is pretty meaningless. As I said, Microsoft and PC vendors have made tons of money with lower-cost machines than Apple. In the end it’s all about the bottom line.

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  4. @Jason Burns there is a very big difference between “9 out of 10 computers” sold and “$9 out of $10 spent on computers.”

    It may not seem like much but it ends up meaning that there could be a lot more PCs sold for over $1000 then the 1 out of 10 that the recent reports makes you think.

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  5. First of all, you are quoting a blog that is quoting another blog which itself references an entity called NPD. Not very reliable, generally speaking. It shows you have not put in a lot of effort to track down first-hand information.

    Secondly, who is Joe Wilcox and why does the link not work?

    Thirdly, if Joe Wilcox, whoever he is, really said that “in June, nine out of 10 dollars spent on computers costing $1,000 or more went to Apple…,” and if this is true, then your example of how this works is dead wrong.

    If someone buys a PC for $1,045, then the dollars spent on a PC costing $1,000 or more are $1,045, not $45. If someone buys a Mac for $1,455, the dollars spent on a computer costing $1,000 or more are $1,455, not $455! I trust that you have graduated from high school. Or that otherwise, the Apple Blog, which I love by the way, required you to submit an unfabricated writing sample before you started writing for them. Seriously, it is not my intention to be a jerk, but this post sucks. I love the Apple Blog, I read it daily, and I hope that in the future it will steer clear of posts like this to the best of their ability.

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    1. Sim,

      I have no issue with criticism, and certainly get plenty of it here, but your post has me confused.

      Not every post can absolve the reader of perhaps Googling something themselves, especially when it’s written on the good faith assumption that the interested reader will know what it is. I did write in good faith, so I’m sorry you didn’t know the particulars:

      ** NPD is a market research firm. They crop up a lot on tech blogs every quarter as they release their data. They’re no stranger to the Apple Blog, having been mentioned in two other posts of ours just this month.
      ** Joe Wilcox wrote eWeek’s “Microsoft Watch” and “Apple Watch” blogs until just a few months ago, and he posts elsewhere as well.
      ** As for me, I’ve been writing on TAB for 10 months.

      Point being that a writer has to assume a certain knowledge. Not necessarily for the entire blog, but certainly by post. When discussing share and retail sales numbers NPD is commonplace, and I considered Wilcox to be as familiar as Paul Thurrott or Mary Jo Foley around here.

      By all means, hammer me for my interpretation of the quote and the whole “91 percent” thing. It’s worth debating because, whether I interpret it right or wrong, I believe the statistic sounds cool but means little.

      However, I disagree with the specific criticisms you brought to bear here.

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  6. So are Macs expensive or not? The narrative keeps changing.

    BTW, any jump in digit places is a pretty significant consumer price point. The four-figure $1k mark seems very reasonable to me.

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    1. I don’t think it was meant to really answer that question. Honestly, I think it’s more of a “good headline” stat that doesn’t really prove anything in terms of how a company (or its competition) is doing.

      For example, what was Apple’s percentage in the mid- to late-90s? Macs have never been “cheap”, so while not 91 it’s safe to say the percentage was very high. Yet Apple was in a death spiral while the Microsoft/PC ecosystem was kicking ass.

      One stat does not a business plan make.

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  7. “So are Macs expensive or not?”

    Yes, well, kind-of. The average Mac definitely costs more than the average PC, but their prices compare favourably to PCs with similar specs. So… expensive, yes, overpriced, no.

    Keep in mind that the term expensive is relative to the person using it, it’s not an absolute way to compare things.

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  8. Tom,

    I apologize for the tone of my criticism. I am used to quality articles coming from the Apple Blog, and I was puzzled to see the breakdown. I am sure that 99% of your pieces are brilliant but this is not one of them.

    As a previous commenter added, “your math does not add up.” That’s my main objection. It’s not really subject to interpretation, either. As I’ve said, if someone buys a PC for $1,045, then the dollars spent on a PC costing $1,000 or more are $1,045, not $45. Tell me how that can be interpreted differently.

    Tomorrow is another day. I look forward to many posts to come, each better than the other.

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  9. You people will believe anything won’t you?

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  10. Many corps buy $2000+ computers thinking they’re getting something better. And most of those computers aren’t Macs. I’d be surprised if either the revenue share or market share for Apple are 90%. But I’d also be surprised if Apple doesn’t make more money per computer than anybody else.

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