updated 04:40 am EST, Tue December 14, 2010
Profit margins greater on premium products
Research firm NDP says that consumers are now paying more for PCs, reversing a downward trend over the past few years according to a report. Computer prices rose by 6 percent in November, bucking a trend towards lower prices for other consumer technology such as HD TVs and digital cameras. Last year consumers were paying an average price of $580 for computers, but this increased to $615 this year.
The global PC market, worth $250 billion, has generally struggled to keep the average selling price of computers high despite improved features and performance. According to the The Wall Street Journal, the big players including Dell and HP are shifting their focus to higher end machines after years of downward pressure on prices and profit margins. HP is making a strong marketing push for its Envy range of premium laptops with keyboard backlighting and high end audio, while Dell claims its high end machines are being snapped up.
During this same period, Apple which has increased its market share despite an overall slowdown in the rate of PC sales growth, has managed to maintain an average selling price of $1,360.
Intel CEO Paul Otellini suggested that some of the credit for the increased margins for PC builders has been Intel's ability to convince consumers that the premium for higher performance is worth paying more for.