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IBM-Apple Neck and Neck in 1992 Computer Sales

January 6, 1993

SAN JOSE, Calif. (AP) _ International Business Machines Inc. remained on top in 1992 in the volatile personal computer market, but not by much.

Apple Computer Inc. was second in PC sales, with Compaq, NEC and Dell Computer folowing up the two giants, according to year-end figures released by Dataquest Inc., a San Jose market research firm.

IBM, the longtime market leader, saw a fall in factory revenue of just under 19 percent in 1992, but retained a slight lead in the market. The firm’s share of the worldwide PC market fell to 12.4 percent from 16.3 percent in 1991, Dataquest said. Worldwide PC sales totalled $46.5 billion.

Apple’s market share grew from 11.2 percent in 1991 to 11.9 percent in 1992. Worldwide, the PC market grew 7.4 percent in 1992, said Dataquest.

International Data Corp., another market research company based in Framingham, Mass. and with offices in Mountain View, also reported similar rankings.

Intel Corp., the Santa Clara-based maker of semiconductors that drive most IBM-compatible PCs, grabbed the worldwide lead in 1992 chip sales, ahead of rivals NEC and Toshiba, Dataquest said.

Spurring growth in the PC market were strong sales of IBM’s Value Point line of low-priced computers and Apple’s sales of PowerBook portable notebook computers and desktop Macintoshes, said Bruce Stephen, IDC’s director of hardware research.

Supporting the sales was the widespread adoption among PC users of Microsoft Corp.’s Windows 3.1 operating system and Apple’s updated System 7.1, said Brad Smith, vice president and chief analyst for Dataquest’s PC division.

Top sellers IBM and Apple were followed by Compaq, with 6.6 percent of market share and NEC with 5.1 percent.

Meanwhile, Dell Computer Corp., based in Austin, Texas, jumped into fifth place from 11th a year earlier. Dell has pioneered the direct-sales and toll- free telephone services that are now being adopted by other producers.

Many of the newer PCs being sold are powered by 486-level microprocessors, developed first by Intel but now also manufactured by others. The more powerful chips allow applications and complex software programs, including the new multimedia mix of audio, video and interactive computing.

Intel, the industry leader in chip development, plans to introduce its latest microprocessor, the Pentium, later this year.

Intel in 1992 outranked NEC and Toshiba in chip sales, showing a 26 percent increase over 1991, according to Dataquest.

The popularity of PCs has been sparked in the past year largely by drastic price-cutting by computer makers, led by Compaq.

A 386-level PC that a year ago sold for $1,500 or more now can be purchased for well under $1,000 at many mass merchandising outlets and by mail.

Meanwhile, the instability of the marketplace is not likely to go away in 1993, analysts said.

Recent price-slashing has helped consumers but caused serious financial problems for some low-end computer makers. On Monday, Everex Systems Inc. of Fremont, a $500 million a year PC maker, filed for Chapter 11 protection from creditors under the Federal Bankruptcy Code.

″The underlying trend here is to fewer suppliers in the industry,″ said Michael Murphy, editor of California Technology Stock Letter, published in Half Moon Bay near San Francisco.

Murphy said dozens of supplies could drop out of the market this year.

On the positive side, Intel’s new microprocessor and new products by companies such as the IBM and Apple joint-venture Taligent are expected to open new horizons for the PC market.

EO Inc. of Mountain View, Apple and others are in a race to produce the first marketable ″personal communicator,″ touted as a hand-held device that combines telephone, fax, pager and pen-based computer functions.

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