Windows 8 'convertibles' help Lenovo break into high-end PC market
Lenovo CEO says Windows 8 PC sales have so far been within expectations
IDG News Service - Lenovo's CEO said sales of its Windows 8 PCs have been "normal", neither surpassing nor falling behind expectations, but added that PC-tablet convertible devices using the OS are helping the company break into the high-end segment for the North American market.
"So in the past, we could only sell $299, $399 products. It's very hard to make money," said Yang Yuanqing on a Wednesday conference call. "That's the first time we not only had a presence in the high-end of the PC, but it also definitely helped us improve the margins."
Late last year, Lenovo launched both its IdeaPad Yoga 13 and ThinkPad Twist convertible PCs as part its lineup of Windows 8 devices. In North America, the products helped the company gain a 30 percent share of Windows 8 convertibles priced $700 and higher, it said in Wednesday's earning report.
Lenovo's CEO has been bullish on convertible PCs, and expects them to become more popular than tablets in the future. Although Windows 8 adoption will take time, Yang said the OS will make convertible PCs mainstream. "We are redefining this new category, we are leading this new category," he said.
Lenovo ranks fourth in market share in the U.S., at 8.5 percent, according to research firm IDC. But globally, the Chinese company is close to overtaking HP to become the world's largest PC vendor, and has consistently reported strong earnings despite the sluggish market.
Earlier this month, the company said it would reorganize its operations into two business groups. The "Lenovo Business Group" will develop mainstream products for consumer and commercial segments. The "Think Business Group", however, will focus on premium products, also for commercial and consumer segments.
Yang said this was done because the business models behind the high-end and mainstream products are different.
"You need to consider the quality and reliability first," he said of producing high-end devices that can be customized. The manufacturing of mainstream products, however, needs to account for speed and efficiency.
Outside of PCs, the company shipped 9.4 million smartphones in the fourth quarter, with 9 million of them for the Chinese market. It was the first time, the company's smartphone business in China has been profitable. Lenovo is also starting to sell handsets in emerging markets including Russia, India, Indonesia, Philippines and Vietnam.
- 15 Non-Certified IT Skills Growing in Demand
- How 19 Tech Titans Target Healthcare
- Twitter Suffering From Growing Pains (and Facebook Comparisons)
- Agile Comes to Data Integration
- Slideshow: 7 security mistakes people make with their mobile device
- iOS vs. Android: Which is more secure?
- 11 sure signs you've been hacked
- Apple-ization of the Enterprise The growing wave of BYOD and increasing numbers of Apple hardware in the workplace holds major implications and opportunity for today's software companies.
- Pay-as-you-Grow Data Protection: IBM Tivoli's Full-featured Data Protection Suite for Small to Medium Businesses IBM Tivoli Storage Manager Suite for Unified Recovery gives small and medium businesses the opportunity to start out with only the individual solutions...
- Streamline Data Protection with IBM Tivoli Storage Manager Operations Center IBM Tivoli Storage Manager (TSM) has been an industry-standard data protection solution for two decades. But, where most competitors focus exclusively on Backup...
- Simplify and Consolidate Data Protection for Better Business Results Learn about IBM® Tivoli® Storage Manager Operations Center, which provides advanced visualization, built-in analytics and integrated workflow automation features that leapfrog traditional backup...
- Meg Whitman presents Unlocking IT with Big Data During this Web Event you will hear Meg Whitman, President and CEO, HP discuss HAVEn - the #1 Big Data platform, as well...
- The New Way to Work Knowledge Vault This Knowledge Vault focuses on how, in today's increasingly virtual world, it's more important than ever to engage deeply with employees, suppliers, partners,... All PCs White Papers | Webcasts