December 3, 2004 12:35 PM PST

Big Blue news a sign of PC market's graying temples

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position for weathering a downturn in demand, Fiering said. The company, which has become the world's largest PC maker and which had just more than 18 percent of the market in the third quarter, has been able to boost shipments and acquire new customers even during the hard times seen between 2000 and 2002.

Apple's uniqueness may have helped it be somewhat immune from the consolidation trend.

Its Macintoshes feature a radically different design from most PCs and use a different OS and processor. That has relegated Apple to a niche, but it has also allowed the company to be one of the few whose PC business is consistently profitable.

More recently, Apple's move into music has allowed it to further stand out from its PC competitors. In recent quarters, sales of the iPod have outnumbered sales of the Mac.

Less clear is how well Apple will be able to translate the widespread popularity of its music player into a greater slice of the computer market.

Although Apple has been able to sell machines that are often pricier than the typical PC, it has not escaped the changing economics and in recent years has radically reshaped operations, moving a great deal of its sales direct to customers and drastically reducing its inventories.

Meanwhile, Lenovo, once known as Legend, is determined to secure a larger role for itself outside of its native China. During 2002, it ramped up plans to sell PCs globally. It even opened a Silicon Valley office and started selling laptops in Spain under its QDI brand. It also had eyes on Thailand and Southeast Asia.

But, by 2003, it retreated, due in part to market share gains in China by Dell and others.

Founded in 1984 by researchers from the Chinese Academy of Sciences, Legend first existed as a distributor of foreign information technology products. It got its start in PCs by becoming AST's distributor in China but dropped AST in 1990. Similarly, Legend had a deal to work with Acer on consumer PCs and went on to sell consumer PCs of its own after the deal ended. The conglomerate makes a wide variety of projects, from supercomputers to cell phones.

CNET's Ina Fried and Michael Kanellos contributed to this report.

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IBM laptops
The dummys should have kept their laptops. No one can come close to the quality. I know the word quality is not used much anymore, but IBM sure used it in their laptops.
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