DisplaySearch Announces Global Wide Aspect Notebook PC Shipments Hit New Record Of 79%; HP Grows 36%, But Only Dell Is In The Top Five In Every Region

November 29, 2006

DisplaySearch, the worldwide leader in display market research and consulting, reveals that wide aspect notebook PC shipments in Q3'06 had a 79% share, with standard 4:3 ratio having only a 21% share. There are significant regional variations, however. North America's wide aspect penetration was over 85%, but in Japan it was merely 52%, according to the latest Quarterly Notebook PC Shipment and Forecast Report. The primary reason for the regional disparity in shipments of standard and wide is a lingering preference in the Japanese market for 1024 ◊ 768 (XGA), 1400 ◊ 1050 (SXGA+), and 1600 ◊ 1200 (UXGA) resolution notebook PCs, especially at 15.0". Although Japan accounted for less than 10% of worldwide notebook PC share in Q3'06, it accounted for more than a 21% share of worldwide standard aspect ratio notebook shipments. By contrast, North America, which had 40.5% share of the worldwide notebook market, had approximately 25% share of the world's standard aspect ratio notebooks. DisplaySearch analysis indicates that these regional differences in the penetration of wide-aspect notebooks will not last much longer, as panel makers are actively scaling back output of standard aspect notebook PC panels after three quarters of poor financial results, and where possible, exiting these markets entirely due to better efficiencies and cost structure for wide panels. As volumes and the supply base for standard panels continues to decline, prices that are currently at relative parity with comparable wide-aspect panels will begin to command a premium as they become niche products and fewer suppliers are available. Regional differences also exist in panel size preferences with EMEA preferring larger notebook PC screen sizes, and APAC and Japan customers preferring smaller screen sizes. In EMEA (Europe, Middle East and Africa), 58% of notebook volume is for products that are 15.4" or larger. In the APAC (Asia Pacific) and Japan regions, this segment is less than 40% of the volume. In Greater China and Latin America, 14.x" products are the dominant form factor, accounting for more than 40% of these regions shipments in Q3'06. Additionally, brands have seen varying degrees of success with wide and standard aspect products. Lenovo's ThinkPad brand, long a staple of the enterprise market, was the last major notebook PC brand to begin shipping wide aspect products. Among the top five notebook PC brands (HP, Dell, Acer, Toshiba, and Lenovo), the share of wide and standard aspect models shipped varied widely in Q3'06: Lenovo shipped 13% wide aspect, HP shipments were 76% wide aspect, and almost all of Acer's notebook PCs were wide (98%). "Differences in the penetration of wide aspect ratio notebooks for each brand are dependant upon a number of factors," said John Jacobs, Director of Notebook Market Research at DisplaySearch. “For a long time, many brands promoted wide as a differentiating factor, and charged a premium for these products, even after panel prices between comparable wide and standard aspect panels disappeared. Brands that were hungry for market share were quick to drop the street price premium, even running “free upgrade" promotions encouraging customers to make the transition. Additionally, brands with a heavier reliance on the enterprise market faced the additional hurdle of convincing IT managers to embrace wide products and support additional configurations." In shipments of notebook PCs, only Dell was ranked in the top five in every region, yet HP overtook Dell as #1 in global notebook shipments. Table 1: Brand Market Share Rank by Region

 
  Rank    Japan  North  America    EMEA  Greater  China  Latin  America  APAC 
  1  Fujitsu/  Fujitsu-Siemens  Dell  Acer  Lenovo  HP  HP 
  2  Toshiba  HP  HP  Dell  Dell  Acer 
  3  NEC  Toshiba  Dell  Acer  Sony  Dell 
  4  Lenovo  Apple  Toshiba  Asus  Lenovo  Toshiba 
  5  Dell  Lenovo  Fujitsu/  Fujitsu-Siemens  Toshiba  Gateway  Asus 

Note: HP does not separate Greater China and Japan from APAC, but groups all three together. HP's amazing 36% Q/Q growth, which is twice the Q/Q growth rate for the notebook PC market as a whole, propelled them past Dell to capture the top spot in the worldwide notebook PC market. By contrast, Dell's growth was significantly slower than the industry average. Acer was another standout, posting substantially larger than average Q/Q growth, edging past Toshiba to re-take the third-ranked spot. Table 2: Q3'06 Worldwide Notebook Shipment Market Share

  Rank  Brand  Q3'06  Unit Share  Q/Q  Growth 
  1  HP  20.1%  36.3% 
  2  Dell  19.9%  13.9% 
  3  Acer  13.4%  28.1% 
  4  Toshiba  12.2%  4.6% 
  5  Lenovo  9.3%  22.7% 

Looking into the fourth quarter, DisplaySearch expects wide products to continue to dominate the market. Consumers, who prefer wide to standard aspect notebook PCs, tend to make up a larger percentage of buyers in the latter months of the year, while enterprises typically slow IT purchases at this time. Additional details from Q3'06 as well as forecasts by size and resolution are in DisplaySearch's Quarterly Notebook PC Shipment and Forecast Report which includes a detailed look at all aspects of the notebook PC market, including long-term forecasts by size and resolution, notebook PC display supply chain, and market share by brand. This report is delivered in PowerPoint and includes valuable Excel pivot tables.

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