FEBRUARY 19, 2009 Apple Stumbles on Price Pressure As Consumers Spend Cautiously, Monthly Unit Sales Are Dealt Setback
By YUKARI IWATANI KANE and BEN CHARNY Wall Street Journal http://online.wsj.com/article/SB123500167089517623.html Apple Inc.'s unit sales of computers through U.S. retail channels fell 6% in January from the same month in 2008, the first monthly decline in three years, according to market-research firm NPD Group. The data suggest that Apple's premium pricing, which helped boost revenue when demand was strong, may be hurting the company now that consumers are being more careful about their spending amid the recession. Demand for Apple's laptop computers, in particular, had remained relatively solid for months despite the economic downturn as consumers were willing to pay higher prices for a sleek design and unique operating system. But NPD analyst Stephen Baker said consumers are becoming more price-sensitive as the economic climate continues to worsen. "Casual buyers or people who are trying to make a choice are trading down," Mr. Baker said. NPD compiles estimates of sales through U.S. retailers, including Apple's company-owned stores and Web site. The firm estimates that the dollar value of Apple's sales through U.S. retail channels fell 11% during the month, faster than the decline in unit sales. Its market share, measured in units, declined to 13.7% from 16.4% in January 2008, NPD said. An Apple spokesman declined to comment. Mr. Baker said he believes that consumers interested in low- to mid-range portables have been gravitating toward Apple's $999 laptop, the company's least-expensive model. He added that demand for the high-end models over $1,500 has been virtually unchanged over the past several months. The average price of Apple computers stood at $1,480 for its laptops and $1,500 for desktops in January -- more than twice as high as computers based on Microsoft Corp.'s Windows operating system, NPD said. Besides high price points, analysts say Apple's desktop personal-computer business has been suffering because the company hasn't significantly refreshed its lineup in more than a year. The company is widely expected to announce a new lineup of desktop machines in coming weeks, which could help boost demand. NPD said unit sales of all brands of PCs rose 13% in January from a year earlier, but the dollar value of systems sold fell 3.2% as consumers bought less-expensive models. Hewlett-Packard Inc. had the strongest showing in the month, while the company's PC unit shipment rose to a market share of 40.1% in January compared with 39.2% a year earlier. "Companies that are able to leverage their size and strength and price against their competitors at any level tend to do better," Mr. Baker said. ================================================= George Antunes Voice (713) 743-3923 Associate Professor Fax (713) 743-3927 Political Science Internet: antunes at uh dot edu University of Houston Houston, TX 77204-3011 *********************************** * POST TO [email protected] * *********************************** Medianews mailing list [email protected] http://lists.etskywarn.net/mailman/listinfo/medianews
