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 (s aapl). 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 (s bby) 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 (s msft) 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.