"Market Share" "Installed Base" and Consumer Electronics

redrum writes "Analysts and reporters like to talk about market share statistics, but the conclusions they draw are often misleading, RDM reports. Market Share Myth 2007: iPod vs Zune and Mac vs PC takes a look at how numbers are used to paint grossly inaccurate portrayals of the market share of the Zune among iPods, and alternatively the Mac among PCs. A follow up article, Market Share vs Installed Base: iPod vs Zune, Mac vs PC demonstrates how the conventional wisdom of market share reporting can be turned upside down by simply comparing what vendors actually sell. An eye opening, in depth look at the real numbers behind PCs, music players, and console games."

Comments

Re:Ahhh, roughly drafted

[Jeff DeMaagd]

The blog entry didn't say that iPod created the hard drive market, it claimed that iPod expanded the market. The blog entry was pretty clear in stating that there were hard drive players before the iPod.

Re:"Myth busting" with undocumented assumptions?

[crmarvin42]

Instead of skimming the article, try reading all of it. He indicates that they idea of 5 year useful life span for mac's vs. 2 for PC's was based on anectodal evidence, yes, but evidence. He didn't just create those numbers out of thin air.

In studying the history of PC purchases made by a client with around a hundred employees, I found the company was still using all of their original Macs dating back to 2001, with a few even older Macs still in secondary use. In contrast, there were no PCs more than three years old still in use, and most of the older models were in poor shape. Around 80% of its machines were PCs, and nearly all of those were commercial grade Dell OptiPlex or Latitude models; the other 20% were Macs. About a third of the entire 115 machines were laptops.

Besides, I've seen several articles over the years indicating that mac's have a longer usful life than PC's. If you need more anecdotal evidence my family has 3 macs that originally shipped pre-Mac OS 10 (2 with OS 9.1 and 1 with the last version of OS 8). they are all currently running OS 10.4 and used every day. I also have one that's sitting in the closet that has 10.3 installed on it and the only reason it's in the closet is because I own more computers than there are people in my house hold.

Re:Most interesting part

[kripkenstein]

In the final quarter of 2007, Apple earned $7.1 billion in revenue, compared to Microsoft's $12.5 billion in total revenue. Yes, that's right, Apple brought in more than half as much money as Microsoft, despite Windows owning 98% of the PC market.

Amusing how RoughlyDrafted sort of misleads with these figures, when he is ranting against other misleading statistics. Based on Wikipedia (disclaimer, but I recall it is basically right from the official reports), Apple had almost half as much revenue as Microsoft in 2006 ($19.3 to $44.2 billion). So yes, as claimed, Apple's revenue is around half that of Microsoft's. But look at net income: $1.73 vs. $12.6 billion - Microsoft makes more than 7 times as much, when measured by net income. So, just as RoughlyDrafted says, partial figures can be misleading.

In this case, the cause of the discrepancy is quite obvious: Microsoft sells a product with zero marginal value - software. This is basically making money from nothing. Apple, on the other hand, makes actual 'real' products, that cost money to make - Macs, iPods.

Re:Ahhh, roughly drafted

[SnowZero]

I'm not sue what article you read. The one I read jumped all over between topics, didn't finish one issue before launching into the next, and included graphs that it didn't even adequately explain. Roughly drafted, indeed.

Re:Most interesting part

[maxume]

On 60% of Microsoft's sales. That is not a good thing for Apple. Microsoft can afford to flat out waste billions of dollars and still have higher operating margins than Apple.

Re:Ahhh, roughly drafted

[gozar]

Expanded isn't really the right word. When the first iPod came along, hard-drive players were using 3.5" laptop hard-drives. Apple found a manufacturer that was about to launch 2.5" drives, and bought 6 months of their entire production, blocking competitors from being able to match their smaller players for the first six months of the iPods life.

It was actually other manufacturers using 2.5" drives when Toshiba introduced the 1.8" drive with which Apple used with the iPods.

Re:Who is redrum?

[imroy]

"redrum" would appear to be Daniel Eran, the owner of roughlydrafted.com. The people over on digg.com have accused him of spamming Digg with his articles and then using sockpuppet accounts to 'digg' his stories (and only his stories) to get them on the frontpage (or however it works on Digg). When this was found out, he was banned from Digg and he took this personally. In his deluded mind this is a conspiracy against Apple by pro-Microsoft minions. He even has people email Apple asking them to set up a "pro-Apple" competitor to Digg. Daniel Eran is a sycophantic Apple fanboy of the worst kind.

Mixed Metaphore

[alexhmit01]

Drinking the Kool-aid refers to a cult whose leader had them drink the poisoned kool-aid and they died. Drinking the Kool-aid means that you believe in the leader on faith, originally from the phrase "don't drink the kool-aid" from the Jonestown masacre.

Sugar-water is Apple specific. When Jobs lured John Sculley from Pepsi, Jobs asked Sculley, "Do you want to sell sugar water for the rest of your life, or do you want to change the world?"

Hence the Sugar Water and "Change the World" quotes are Apple quotes, and have nothing to do with the Kool-aid quote you are referring to.

DECS (Daniel Eran) submitted this story as redrum

[MojoStan]

"redrum" would appear to be Daniel Eran, the owner of roughlydrafted.com. DECS's Slashdot User page (scroll to bottom) shows that DECS (Daniel Eran) submitted this story. DECS has also sucessfully submitted (got accepted) six other stories that pimped his own site, roughlydrafted.com. It appears that Daniel Eran entered "redrum" in the "Your Name" field of the Slashdot Submission page, but DECS's user page reveals the true submitter of this story.

The people over on digg.com have accused him of spamming Digg with his articles and then using sockpuppet accounts to 'digg' his stories (and only his stories) to get them on the frontpage (or however it works on Digg). When this was found out, he was banned from Digg and he took this personally. Daniel Eran's shenanigans have actually been covered on Digg:

• PROOF that Roughly Drafted is SPAMMING/Gaming Digg with multiple accounts (97 diggs)

Photographic evidence of AlexaW and RoughlyDrafted gaming Digg just to get moron Daniel Eran's articles to the front page. (Where they promptly get buried for being inaccurate.) Several users who ONLY digg AlexaW's submissions, all of whom signed up in the last 3 weeks. Coincidence? Not a chance. This needs to be stopped immediately. More on Daniel Eran:

• RoughlyDraftedBUSTED
• RDMBusted2
• Greenpeace response to Roughlydrafted