Windows 8 Launch Failed to Stem Declining Holiday Notebook Sales

According to the NPD Group, over the holiday sales period, Windows 8 did nothing to revive the sales of Windows notebooks, with sales actually declining compared to the previous year.

This has to be disappointing news for Microsoft, but not altogether unexpected, given the mixed reviews and anecdotal evidence of poor sales of the Surface RT.

Many Windows PC and notebook manufacturers also seemed slow out of the gate with their own systems. The NPD statement went as follows:

Despite the hype, and hope, around the launch of Windows 8, the new operating system did little to boost holiday sales or improve the year-long Windows notebook sales decline. Windows notebook holiday unit sales dropped 11 percent, on par with Black Friday, and similar to the yearly trend, but revenue trends weakened since Black Friday to end the holiday period down 10.5 percent. (Average selling srices) ASPs rose only $2 to $420. Touchscreen notebooks were 4.5 percent of Windows 8 sales with ASPs around $700. Sales of Windows notebooks under $500 fell by 16 percent while notebooks priced above $500 increased 4 percent. Macbook sales dropped 6 percent while the ASPs rose almost $100 to $1419.

Some interesting notes here include the scale of the decline in Windows Notebook sales – 11%. That is precipitous and puts to rest the argument earlier made by Dell and others that tablet sales are not cannibalizing PC notebook sales. They are.

This also includes Macbooks apparently – with a 6% sales decline. However, Apple is suffering less for two reasons. First, its ASP rose by $100 or 7.6%, making up the difference and then some.

The second reason is the fact that it benefits the most from the explosion of tablet sales with the iPad and iPad Mini.

Strategically then, what is critical for Microsoft – in addition to maintaining its huge advantage in corporate IT software and hardware – is to make inroads in tablets and smartphones.

That takes no great insight. However, Microsoft must realize this cannot be done at high price points. Consumers are used to cheap tablets, period. Sub $500.

It doesn’t matter if you have Office 2013 on them. It won’t overcome brand names such as the iPad and Samsung Galaxy.

It is also no accident that touch-enabled notebooks accounted for only 4.5% of Windows 8 notebook sales. That is surprising, given its touch-centric design, but understandable, given their higher price points.

Go ahead and share your thoughts on the holiday sales report below.

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