Android And Chrome Begins to Seize PC Market

By Douglas A. McIntyre Updated Dec 30, 8:51AM EST · Published Dec 30, 6:26AM EST

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Updated for data on Chrome 8:48 12/30/2013

The desktop, laptop and tablet markets are supposed to be dominated by Apple Inc. (NASDAQ: AAPL) and Microsoft Corp. (NASDAQ: MSFT). But both face erosion of their leads — Apple in the tablet world and Microsoft in the laptop segment. The major culprit of the erosion is the same one that has dogged them in the smartphone space — Google Inc.’s (NASDAQ: GOOG) Android and Chrome OS. And its rise is causing the market share of the incumbents to tumble.

One bit of good news for the entire industry, according to research firm NPD:

Year to date through November 2013, 14.4 million desktops, notebooks, and tablets were sold through U.S. commercial channels, leading to a 25.4 percent increase over 2012.

As expected:

Desktop sales through the channel increased 8.5 percent, notebooks grew 28.9 percent, and tablets jumped 49 percent growth over the same time period in 2012.

Google’s OS was the clear winner in the tablet class:

Chromebooks, and Android tablets collectively had the biggest impact on sales growth, with 1.76 million units going through the channel from January through November of this year, compared to just 400,000 units in 2012.

Experts are left to puzzle at the tilt toward Android and Chrome, with one of the primary theories being that because these products are relatively new their market share is bound to gain. The theory is flawed. Demand is not created just by novelty, unless what is novel also works well for consumers.

One of the key advantages to Chromebooks and some Android powered machines is price. Hewlett-Packard Co. (NASDAQ: HPQ), Samsung and Acer have large portions of the Chromebook and Android market. These manufacturers sell machines for as little as $199, and most have products priced below $300. Amazon.com Inc. (NASDAQ: AMZN) has versions of the Kindle that are priced that low. However, the base Apple iPad Air retails for $499, and one version of the product sells for $929. Generally, Windows-powered machines have prices closer to the high end of this range than to the low end.

Once again, Google has been clever. Tablet and laptop manufacturers are in a bloody war. Android already has established its brand with consumers through the smartphone business. Chromebooks have begun to establish their own brand in the PC business. These have been able to help manufacturers to marry that brands with low prices.

Soon, Chromebooks and Android-powered PCs will be the products to beat, just as they have been recently among smartphones.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.