Half of all US homes had at least one personal computer at the end of 1998, largely in part because of a big drop in prices, a market researcher said Tuesday.
Unit shipments also rose substantially in 1998. Just 43 percent of homes had a PC in 1997, according to a survey released by Dataquest on Tuesday.
"It's pretty astounding," said Van Baker, director of Dataquest's consumer market research. "Not very many consumer devices in the home have passed that bar."
PC ownership rose across all income levels, according to the survey of about 3,000 households, but much of the growth came from households with lower incomes or people without college degrees. A big drop in PC prices made them more affordable last year, Baker said.
In the next few years, PC penetration will climb toward 65 percent. "Anything above that will be other devices like set-top boxes and Internet-enabled phones," he said.
But a growth in sales doesn't necessarily mean more profits for retailers.
"Unit volume is growing extremely well, but revenue is not," Baker said. Even experienced users are buying cheaper computers. Only about a third of the people buying PCs under US$1,000 were first-time buyers.
John Hough, spokesman for Seattle-based Egghead.com, said dropping profit margins helped lead the online store to diversify itself beyond hardware.
"If that were your only merchandise, it would be very difficult to absorb," he said.
