Consumer mania for sub-$1,000 computers drove up sales and market shares for computers powered by processors from Advanced Micro Devices and Cyrix at the end of 1997. While it remains to be seen whether the trend will continue, recent design wins by these companies and computer pricing trends seem to indicate that the Intel alternatives will continue to find a place on store shelves.
In November, machines running processors from AMD accounted for 15 percent of all retail desktop computers using Intel or Intel-compatible chips (so-called x86 chips), up from a 6.1 percent share in October and a 6 percent share in September, according to Stephen Baker, senior hardware analyst for PC Data, a Reston, Virginia-based research firm. AMD yesterday reported that it had met its goal of shipping 1.5 million K6 chips during the quarter.
Intel, meanwhile, saw its retail sales dip to 82 percent in the x86 market for the month, down from an 89.2 percent share in October and an 88.7 percent share in September, according to PC Data. By product line, the Pentium MMX remained the dominant processor in November, accounting for 60.7 percent of all x86 retail sales. The Pentium II, by contrast, represented 17.2 percent of all November retail sales.
"The 233-MHz K6 machines really started to hit the market in November," Baker said. "It's been moving back and forth between Cyrix and AMD, depending on who has the hot price point."
Overall, non-Intel computers surged to 21 percent of total retail sales in November, up from 11 percent the month before, reported Elissa Sandler at Intellect ASW, another market research firm.
Computers adopting these processors, naturally, saw their sales rise as well. CTX International, a company which uses both AMD and Cyrix chips, surged to the No. 4 position in retail with a 7.8 percent market share, according to Computer Intelligence. The company also held a 16.5 percent share in the sub-$1,000 category.
"CTX did very well. They are up-and-coming now," said Matt Sargent, an analyst with Computer Intelligence, pointing out that the company did not even register as a major vendor at the first part of the year.
Additionally, Acer, which has adopted the K6, surged to fifth place with a 6.1 percent share overall in retail and an 11.1 percent share in the sub-$1,000 sector.
Compaq also continued to enjoy sales on its Cyrix-based Presario 2200 series. The computer accounted for nine percent of Compaq's retail sales and was the company's fourth-most-popular retail model in November, Sargent added.
Whether this trend continues remains an open question. Earlier this month Compaq revealed that it was adopting the K6 for its consumer computers below $1,200, a move which effectively puts the K6 at the center of the retail computer world. IBM has also announced that it will expand its use of the K6.
Baker, however, pointed out these gains could be temporary. Cyrix, for instance, saw its market share decline with AMD's rise. Cyrix-powered computers in retail accounted for 3 percent of sales in November, down from 4.7 percent in October and 5.2 percent in September.
Meanwhile, Intel cut the prices on the Pentium II toward the end of the year, which will likely result in a resurgence for Intel for December sales. Further price cuts could erode this even further in 1998.
"The K6 and the Pentium II were running about even, but I don't expect it to stay that way," Baker said.