Desktop PC Sales Hot, Despite Notebook Gains

Consumers unable to ignore the lure of getting more for less money have caused a resurgence in PC desktop sales, pushing annual growth rates for the last five months in the low double digits, a market research firm said Monday.

Despite the hotter notebook market, people have continued to buy desktops, as prices have fallen for computers that offer more horsepower, larger hard drives, more memory and overall better value than a year ago, Current Analysis said. Year-to-year growth rates for U.S. retail PC sales have ranged between 10 percent and 20 percent each month from November 2005 to March 2006.

"This unforeseen resurgence of a category pronounced dead back in 2004 is attributable to several factors, but value and digital media attributes lead the pack," said Toni Duboise, analyst and author of the report said.

PC-only desktop prices have fallen as low as $199, with a computer plus monitor starting at $299. But these basic configurations, sufficient for PC applications such as Internet access, email and word processing, have not been the hottest sellers.

Instead, desktops built for digital media, whether audio, photo or video, have posted annual growth rates during the five-month period of 75 percent for computers in the $400 to $499 range, and 88 percent for those priced from $700 to $799.PCs running Microsoft's Windows XP Media Center OS now dominate the market, accounting for 60 percent of desktops sold in U.S. retail.

"The fact that a growing number of digital media PC user require better performance and bigger storage repositories also bodes well for a sustained resurgence for the desktop space," Duboise said.