Smaller PC manufacturers gain larger market share

By Chris Barton.

The New Zealand PC market has a new leader - "other" - about 200 local assemblers who collectively accounted for 40 percent of the pie in 1998.

Responding to pressure from both Intel and Microsoft, research company IDC has found 30,000 more PCs were sold in 1998 than previously estimated.

The new figures will also significantly downgrade the New Zealand market share percentages of the leading US PC brands - Compaq, Hewlett-Packard, IBM and Dell. IDC is yet to provide the new percentages.

"I've been pushing IDC for some time to revisit its figures," said Microsoft original equipment manufacturer (OEM) manager Brett Roberts who collects data on the number of its Windows operating systems sold to local assemblers.

"The local guys were shipping a lot more than they were being given credit for," he said.

Confirmation that IDC has underestimated the market size also came from Intel which tracks the number of processors sold to local manufacturers.

Intel technical account manager Dale Townsend said IDC hadn't acknowledged the existence of the "second tier" manufacturers and had been suggesting for about 12 months that it should revise its numbers. IDC gathers its market research by asking PC vendors how many units they sell each quarter and then cross checks numbers with other information sources.

Mr Townsend estimated that some 60,000 Intel processors - including about 30 percent "grey market" parallel imports - were sold to local PC makers in 1998.

Other microprocessors used locally include chips from AMD and Cyrix.

Microsoft's Brett Roberts estimated the local market to be close to 40 percent of the total which would indicate about 107,000 OEM copies of Windows sold.

Microsoft data showed about 200 "active" local manufactures - 20 percent of which were responsible for the bulk of the PCs sold.

The information has lead IDC to revise 1998 total PC figure up from 238,000 to 268,000 units representing $805 million in sales . It's also adjusted 1997 numbers from 213,000 units to 242,000.

"These figures have been there all the time. Local assembly has always been a strong part of the market and its growing all the time, " said Colin Brown managing director of the PC Company,(formerly Pegasus) one of the largest local PC makers.

US manufacturer Gateway's purchase of PC Direct late last year means the leading local brand which sold about 18,000 PCs in 1998 is likely to depart the New Zealand PC landscape this year. That leaves the PC Company, Arche Technologies and Edge Computer as the largest local assemblers - each with 3-4 percent market share, according to Mr Roberts.

Total Peripherals Group which IDC ranked as the No. 8 PC vendor in 1997 with 4.1 percent market share may also be among the local leaders, but does not show in Microsoft New Zealand's numbers because it reports its Windows figures to its Australian parent.

Other local PC names each with 2-3 percent market share include Green PC, TMC, Ultra, Quay Computer, Cyclone, Modern Technology, Insite and TL Systems.