Microsoft fingered for Western Euro PC tragedy

The decision to kill off Windows with Bing heaps misery on OEMs

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Microsoft last year effectively murdered one part of the mobile PC market that was going gangbusters - Windows with Bing (WwB) - and unsurprisingly this is now reflected in weaker sales across Western Europe.

The low-cost WwB portables reached distributors by summer '14, designed to counter what was seen as a growing threat to Microsoft from Google Chromebook by giving OEMs a heavily discounted Windows licence.

The threat didn’t amount to much however and so Microsoft restricted use to 14-inch notebooks and below, and increased the cost for the software used on the remaining range. Redmond knew this would put a bullet in the products because the sales sweet spot was for 15-inch WwB lappies.

The impact of this was seen in distributors’ official sales data compiled by venerable analyst Context, with units falling nine per cent in Q1 versus the same quarter a year ago.

“Q1 2016 was a challenging quarter for PCs in Western European distribution,” said Marie-Christine Pygott, senior analyst.

The decline was partly related to Microsoft’s WwB decision, as the products helped sales grow 14 per cent. Bing’s share in notebooks had been 17 per cent but fell to 0.4 per cent in the opening three months of this year.

In total, notebook sales fell 10 per cent across the region and desktops slipped by seven per cent. It was not all doom and gloom though, the hybrid segment continued to ramp, albeit the overall volumes are relatively small.

Average sales prices also went up by eight per cent to €506 - not good for customers but a welcome fillip for suppliers used to margins going on way. Vendors raised prices to offset the strength of the dollar, and this meant PC revenues were down just one per cent in the quarter.

Distributors in France were was worst hit by the sales downturn, dropping 16.2 per cent, followed by Poland, the Netherlands and Sweden, down 12.4 per cent, 12 per cent and 11.9 per cent respectively. Unit sales in the Spain dropped 10.7 per cent, were down 7.3 per cent in the UK and 4.9 per cent in Germany, while Italy fell 3.9 per cent. Only Switzerland recorded growth in box sales, up 7.8 per cent. ®

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