Apple Computer could substantially increase its share of the personal computer market by year's end, all thanks to the company's iPod music player. This prediction was made by analysts at Morgan Stanley. a New York-based financial services company. The report also upgraded Apple's stock to overweight and set a price target of $60 per share. Rebecca Runkle and Kathryn Huberty, the authors of the report, said Apple Computer Inc., could see its global PC market share increase in 2005 from about 3 percent to 5 percent. Market share represents the number of units sold in a period; this is distinct from the idea of installed base, which is how many total people own the product. The report based its conclusions on a survey of 400 iPod users. Seventy-six users, or 19 percent of the sample, said they expected to switch from using a Windows-based PC to an Apple Macintosh. This is nearly double the figure of 10 percent previously assumed in other analyses of the "halo effect"—iPod owners moving on to purchase a Macintosh computer. The survey polled four groups of 100 respondents between the ages of 18 and 54. The first group comprised iPod owners who had bought a computer in the past year but were not replacing a Mac. The other groups comprised iPod owners who expect to buy a computer within the next year and do not currently own a Mac; people without an iPod who bought a computer in the past year but not to replace a Mac; and non-iPod owners who intend to buy a computer in the next year but do not currently own a Mac. In addition, the report found that iPod owners had purchased, on average, 2.8 accessories for the music player. Since many of these are bought at Apple's online or retail stores, the report concluded that each iPod sale returns more revenue to Apple than simply the profit on the iPod itself. Most at risk due to Apple's predicted market-share increase, the report said, is Hewlett-Packard Co. In a survey taken for the report, Morgan Stanley asked potential computer buyers which major PC manufacturer would be their first brand of choice. HP garnered only 3 percent of preference, even from iPod owners. The report concludes that HP's move of selling an HP-branded iPod will have little effect on expanding HP's computer sales. UKFast is not responsible for the content of external Internet sites.
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