The conventional wisdom is that Hewlett-Packard’s (HPQ) quarterly results come at the expense of Dell (DELL). The reasoning may be sound. Sales at the HP unit that includes PCs rose 24%. As MarketWatch wrote: "That’s more than double the industrywide growth rate, which means H-P is taking market share from somebody." Laptop revenue rose 45%.
But, the other piece of new that hit the market this week is that Microsoft (MSFT) sold about 40 million copies of its new Vista operating system since is launch about four months ago. There is no way to tell how many of these were sold with new PCs versus being downloaded to older ones. But, Vista is processor intensive, so it may be that a number of businesses and consumers opted to get new and more powerful machines. If so, a rising tide may lift Dell, HP, and their rivals.
Server sales should also be rising. As internet traffic and the need for storage increases, the demand for servers grows. Dell has about 22% of the global server market. IDC projects that servers sales will increase by 39% but 2010.
The restructuring of Dell may do little to help the company. But, a trend toward buying new hardware and Vista pushes PC growth and Linux pushes server sales may pull the big hardware company out of its rut.
Douglas A. McIntyre
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