Notebooks pass desktops in U.S. retail

For first time, stores sold more laptops than desktops. When will notebooks lead overall? IDC makes a prediction.

The numbers are in, and the U.S. is notebook country.

Sales of notebooks surpassed desktop sales in the U.S. retail segment for the first time, according to a report from Current Analysis. Notebooks accounted for 50.9 percent of personal computers bought at retail in 2005, while desktops accounted for 49.1 percent. In 2004, notebooks accounted for only 43 percent of U.S. retail sales, while desktops accounted for 57 percent.

The United States only accounts for roughly 9 percent of the worldwide market, and retail figures exclude sales from large resellers to corporations or direct sales from companies like Dell. Still, retail is an important segment, and overall notebook sales are rising, too. Richard Shim, an analyst at IDC, predicted that overall notebook sales in the U.S. will surpass desktop sales by late 2007. Until recently, the research firm thought that notebook sales would not pass those of desktops until 2008.

Low prices are one of the primary reasons for the surge in laptops. Several manufacturers offer fairly high-performance notebooks for about $1,000, while base-level notebooks can be scooped up for $499 to $699.

The proliferation of wireless networks since 2003, along with consumer adoption of wireless technologies, has also driven demand. Although most notebooks to date connect wirelessly through Wi-Fi, a number of companies are now selling notebooks with integrated cellular capabilities.

One of the big beneficiaries of the trend has been Intel. Since the 2003 launch of the Centrino mobile-chip bundle, notebooks have played an increasingly large role in Intel's profits. The company recently released a new version of Centrino based around dual-core chips. Rival Advanced Micro Devices experienced an uptick in notebook chip sales in the fourth quarter. Among PC makers, notebook-heavy Toshiba bounced back into the top five computer makers worldwide on the strength of portables.

"We?re seeing a fundamental shift in consumer buying behavior. We expect this trend to continue as 2006 will give the mass market dual-core processors and 64-bit capabilities," said Sam Bhavnani, an analyst at Current Analysis.

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