January 28, 2003 1:07 PM PST

Microsoft tablets start strong in Europe

Sales of portables running Microsoft's Tablet PC software started strong out of the gate in Europe, according to market researcher Context.

Despite only a partial quarter of sales, Microsoft tablet PCs accounted for 1 percent of European portable sales during the fourth quarter. Microsoft launched its Windows XP Tablet PC Edition on Nov. 7, with Acer, Hewlett-Packard, Fujitsu-Siemens, Toshiba among the manufacturers selling portables using the software.

The majority of manufacturers use a flat design with 10.4-inch or 12.1-inch display. Toshiba's model is a more typical subnotebook that morphs into a tablet. Users can either input written text or drawings with a stylus or attach a keyboard for input.

While Microsoft has been hot on the technology's rapid adoption, analysts have been cool. IDC expects manufacturers to sell only 425,000 units worldwide--or about 1 percent of all portables--this year.

But early sales in Europe suggest potentially stronger numbers than previously forecast.

"Normally when a new technology or form factor is launched, these tend to be aimed at early adopters willing to pay premium prices," Context analyst Jeremy Davies said. "Take-up is therefore slow as the product eventually goes mainstream."

But tablet PC pricing, which ranges from about $1,799 for HP's tablet and $2,799 for Gateway's, is more in line with typical portables.

"What we are seeing here is a substantially innovative development in portable PCs that is coming in at relatively low prices," Davies said. "We'll know quite soon if tablet PCs are striking the right chord with users."

Overall, the portable market is on a roll in Europe, growing four times as fast as the total PC market, according to Context.

As expected, businesses account for the vast majority of tablet PC sales--89 percent in Europe. For the fourth quarter in Western Europe, HP snatched the top spot, with 38.5 percent of the market, followed by Acer with 24.3 percent, according to Context. Fujitsu-Siemens captured the third position with 19.7 percent, while Toshiba claimed the fourth spot with a 17.5 percent share.

During December, in the top seven European countries--France, Germany, the Netherlands, Italy, Spain, Sweden and the United Kingdom--HP also took the top spot, with 45.6 percent of the market. The seven countries account for about 80 percent of all computer sales in Europe.

Acer took the No. 2 position with 33.6 percent of the market, followed by Toshiba at 13.8 percent and Fujitsu-Siemens at 6.9 percent. Context's figures for the top seven countries represent actual retail sales, while the quarterly figures measure units shipped by manufacturers to dealers.

 

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