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'Stagnant' 2011 PC ecosystem viewed as opportunity for Apple to make gains

Both Apple's Mac and iPad lineup are poised to make significant gains in the second half of 2011, as the Windows-based PC market remains "relatively stagnant" and is predicted to see 4 percent growth, according to a new analysis.

Deutsche Bank analyst Chris Whitmore believes the traditional PC market does not have "meaningful new offerings" coming this year, while Apple is aggressive with both new hardware and software. Heading into the back-to-school and holiday season, he sees Apple as "particularly well positioned for more share gains."

Specifically, Whitmore cited the recent launch of Mac OS X 10.7 Lion, as well as Thunderbolt-equipped MacBook Airs introduced last month as key products in driving Apple's market share gains.

While Whitmore sees the Mac making further inroads, he has projected the PC market will grow 4 percent this year, a number that is below Wall Street consensus. He said while corporate PC demand is healthy, consumer demand for Windows-based machines, particularly in developed markets, has disappointed.

"Our recent checks with the PC supply chain suggest overall orders have softened modestly in the past several weeks due to weaker European and U.S. consumer (notebook) demand and more conservative back-to-school expectations from OEMs," he said.

Further helping Apple's cause are the troubles apparently faced by PC makers looking to develop the Intel-based "Ultrabook" specification for thin-and-light notebooks. Whitmore said PC manufacturers have suggested that Ultrabook production won't ramp up materially until 2012, as the industry struggles to compete with the pricing of Apple's MacBook Air.

Deutsche Bank


While the Mac alone is predicted to earn market share gains at the expense of Windows-based PCs, factoring in the iPad makes Apple's growth even greater. Calling it the "Gold Standard" of the tablet market, Whitmore said the iPad will continue to dominate for the foreseeable future, while competitors, like the recently discounted HP TouchPad, are expected to struggle.

Whitmore said Apple will make it even more difficult for the competition this fall, when it launches its next-generation mobile operating system, iOS 5. The fifth major version of iOS will add features like Notification Center, iMessage and Newsstand to the iPad, as well as the iPhone and iPod touch, when it becomes freely available later this year.