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Netbooks a temporary Band-aid on PC industry

Mini notebooks push up sales worldwide, but U.S. growth stalls despite declining prices.

Erica Ogg Former Staff writer, CNET News
Erica Ogg is a CNET News reporter who covers Apple, HP, Dell, and other PC makers, as well as the consumer electronics industry. She's also one of the hosts of CNET News' Daily Podcast. In her non-work life, she's a history geek, a loyal Dodgers fan, and a mac-and-cheese connoisseur.
Erica Ogg
2 min read

Despite the volatile economy, the PC industry overall appears on the surface to be doing fine thanks to the influx of cheap, underpowered notebooks.

Overall, worldwide PC shipments rose to 80.6 million units during the third quarter this year, a 15 percent increase over the same quarter a year ago, according to a new quarterly report issued Tuesday by research firm Gartner. In the U.S. however, the picture is not so rosy.

Acer netbooks PCs
Netbooks like Acer's AspireOne are selling well, but are they cannibalizing less-expensive mainstream notebooks? Acer

Perhaps because of consumers' economic worries, a lot of sub-$500 computers sold in the third quarter. Whether it's a new worldwide Netbook market that's being created, or they're cannibalizing cheap laptops, isn't quite clear yet, according to Gartner PC analyst Mika Kitagawa.

Either way, PC sales in Europe, the Middle East, and Africa grew five times faster than in the U.S. to reach 28.8 million units in the third quarter.

The two quickest to enter the Netbook market, Asus and Acer, are being rewarded for their efforts: the two vendors experienced some of the best growth during the third quarter of this year. Acer is now the top vendor in that region, displacing perennial leader Hewlett-Packard. Acer's concerted efforts to ship Netbooks there were chiefly responsible for the change, said Gartner.

Almost a year into being combined with Gateway, Acer is also now firmly entrenched as the third-largest PC maker in the world. It shipped just over 10 million units, which is 47 percent more than a year ago. It's also good for 12.5 percent of the worldwide market.

Acer, which had been battling with Lenovo, is now nipping at Dell's heels: Dell is in second place with 13.6 percent of PCs sold in the third quarter, and Hewlett-Packard continues to lead with 18.4 percent. Lenovo stayed in fourth place with 7.3 percent of the market, and Toshiba, which had some of the best growth at 25.8 percent during the quarter, remained in fifth place with 4.6 percent.

Asus, while not in the top 5, had "robust" growth, which Kitagawa estimates is in the triple digits. The final numbers have not yet been tallied, since the report is just a preliminary one, she said.

But in the U.S., PC sales grew at a dismal rate of 4.8 percent. That's not good for a quarter usually lifted by back-to-school sales of computers. And even though prices on mainstream laptops and desktops continued to drop, it wasn't enough to lure in as many consumers as retailers had hoped, Gartner's Kitagawa said.

In the U.S., Dell continues to be the dominant supplier with 29.5 percent of PCs shipped, and HP is right behind at 25.7 percent. Apple (9.5 percent share) grew at six times the U.S. market, or almost 30 percent more units shipped than the previous quarter--and that's despite not refreshing its notebook lineup until Tuesday. Acer, at just under 9 percent of the market, experienced 11.2 percent growth. Toshiba stayed in fifth place with a 5.6 percent share.