Windows Consumer Growth Rate Outperforms Macs

From: Paul Thurrott's SuperSite For Windows

4-23-2010

Hitting Them Where It Hurts: Windows Consumer Growth Rate Outperforms Macs

Todd Bishop has a great story about Windows PCs blowing away the Mac in the consumer market. But the bigger deal here is that he hits on an important point that many people regularly miss: While Apple always puts up huge growth numbers for the Mac, it's easy to do that when your market share is tiny. But it's almost impossible to do so when your market share is huge. So how did Windows outperform the Mac so handily this past quarter? I'm sure the Apple apologists will have their theories or, more likely, simply try to change the discussion ("Look! It's the iPhone!"). But the truth is that consumers buy PCs, not Macs. And that's as true in the US as it is elsewhere in the world.

Buried in Microsoft's earnings report today is an interesting statistic that suggests the company's new Windows 7 operating system may be having some success in beating back Apple in the critical consumer market.

In the financial data accompanying its earnings release, Microsoft said worldwide Windows consumer licenses grew by more than 35 percent in the recent quarter. By comparison, Apple this week reported an increase of 33 percent in Mac sales over roughly the same time period. That was impressive, too, of course, but Microsoft is growing from a significantly larger base of sales to begin with, making its higher growth rate considerably harder to achieve.

"Of course we're going to outsell them on a unit basis, but on a rate basis, on a market share basis, we actually outgrew Apple Mac in the third quarter worldwide," said Brad Brooks, a Microsoft Windows corporate vice president, referring to the quarter in the context of the Redmond company's fiscal year, ending in June.

Discussing the PC market-share numbers, Microsoft's Brooks acknowledged that some skeptics might point to the fact that Microsoft is active in fast-growing, developing nations where Apple doesn't have a presence. But he cited a recent IDC report showing Apple's market share declining in the U.S. in the first quarter, calling that consistent with Microsoft's internal numbers.

"We definitely took share," he said.

Good stuff.

SOURCE

The only thing that gets me about Microsoft vs Apple is this. I'm not an Apple fan, their products are expensive, and many of it's own users can't even use them. With that in mind, why is it that when an Apple product is released, people wait outside in the cold all night to obtain it? Why is it the when Steve Jobs does a presentation, there's standing room only? Why is it that Apple's stock is over $250/share, and the corporation has $40 billion in cash reserves? There's rumor they are taking over some major computer related company. Mac has around a 5% market share, Windows has over 90%. Yet the sales figures, although Microsoft is in the lead, the dollar amount isn't really that far apart. Apple has $40 billion in cash for only 5% of the market share. Going strictly by usage figures, Apple shouldn't even be in the discussion, but they are, and I wonder, how is it that a corporation with such a large following (Microsoft) allow Apple to keep hanging around?

First of all, competition is good for the marketplace. A free and open computer software market ensures better products for all concerned.

M$ and Apple are the BIG TWO, its just that M$ is a hell of lot bigger product volume wise versus Apple. Both will probably will be there for many years to come.

Apple appeals to the elitist, with snob appeal and marketing creating an "exclusivity" that some consumers must have to live their lives vicariously through their toys, cars, computers, houses, etc.

Apple charges a premium for their products, which use upper mid-level hardware. That's why there's a $40 Billion cash reserve. In additon, they're very shrewd with the companies who do the OEM production of their products ensuring they get the most bang for the buck spent.

Apple is also ruthless when it comes to "absorbing" what they perceive to be the competition, especially small companies.

M$ makes an OS only and other software for it. Their approach is to appeal to the broadest common denominator in the marketplace. From the heart surgeon to the single mother with 3 kids on a shoestring budget.

Gates and Balmer have done a pretty good job, it's just sometimes there are massive hiccups like Windows 98 - First Edition, Windows ME, and Vista. Other times they excel such as Windows 95, Windows 98 SE, 2000, XP and 7.

I believe the company has learned its lesson from the Vista debacle and will continue the method they used with 7 and release BETAs to the techies, general users and such for testing and reviewing.

I certainly hope neither one reaches the point to where they have a monopoly on computer operating systems, then the consumer will pay through the veritable yingyang for a product which would be better and less expensive if there was competition. Apple helps to keep M$ more or less honest and improving their product line.

Hey, I have to jump in here, being both an Apple and MS user, I say here as I say to people on the Apple forums I've no time for this 'tribal' rubbish where one group slangs off at another.
Neither is 'better' just different. Until XP Mac software was faster and more stable and needed less memory then Windows machines.
You always could and still can purchase a PC far cheaper then you can a Mac but if you start getting into high end PC components the gap is much less.

Modern Macs are far neater in design but generally more expensive to fix.. You could go on for hours with this and that but why bother. Just get whichever gives you most pleasure.

Mychael

There are Apple forums with very clever users helping newbies as much as there are PC forums for newbies with problems.
Apple markets complete packages where as Microsoft is a software manufacturer.

MS lost a lot of ground with Vista as did Apple in the low times before Steve Jobs took the reins again.

They are different market niches and one will never kill off the other.

I realize that, Apple has their following, and they're loyal. But my point was this. Microsoft has over 90% of the computing population under their wings. Apple (or MAC) has only 5%. The money that Microsoft takes in doesn't reflect that. Microsoft has made more money than Apple, but not by the margin that you would think, based simply on the fact of market share. Microsoft should be bringing in 18 times the cash as Apple, based on usage figures. But they're not even bringing twice as much. The cash gap is a lot closer than you would think. A LOT closer. I realize Apple is "here to stay", but so is Microsoft. Apple is rumored to be in the process of purchasing a computer related company in Europe, it's said that if this happens, all other brands of OS's will be in trouble. Why doesn't Microsoft simply step in, and brush Apple's bid to the side? They should have enough cash on hand to do so, based on market share.

I would never even think twice about such a comment. People will say anything to get a response from the public or a high reader rate regardless of whether its true or not. From my stand point who cares. I'm going to stick with what I know. If MS goes belly up, I would then be forced to consider something else. Until then it is pointless in talking about something you have no control over.

Clifford, you're right, Apple wants to be in the spotlight, and may do anything to stay in it. It's probably all for attention, and believe me, they're getting it. I've never been an Apple fan, don't care whatsoever for them, and never will. But they do keep things stirred up a lot.

There has been some discussion going about of Apple considering buying ARM a computer chip manufacturer. ARM chips are to be found in many types of modern electronic gear.