Toshiba pulls out of U.S. desktop PC market

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By Joris Evers

(IDG) -- Toshiba will stop selling desktop computers in the United States and focus on mobile computing and servers, a Toshiba spokesman said Thursday.

"Considering the U.S. market situation for desktop PCs, Toshiba America decided to gradually stop selling desktop PCs," said Kenichi Sugiyama, spokesman for Toshiba in Tokyo.

"We will concentrate our efforts on notebook computers, PDAs [personal digital assistants], and servers," he said, noting that support will still be available for customers who own a Toshiba desktop machine.

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The U.S. and worldwide PC market is in turmoil, with falling sales for the majority of vendors and an ongoing price war led by direct seller and U.S. market leader Dell Computer.

Toshiba, mostly known for its notebook PCs, continues to sell desktops in Europe and Japan, but Sugiyama hinted that the company might axe its entire desktop business.

"Frankly, desktops just take a few percent of Toshiba PC production. We only sell small quantities in Europe and Japan, but at this moment we continue to sell desktops there," he said.

It makes sense for Toshiba to reconsider its desktop PC business, said Brian Gammage, principal analyst with Dataquest, a unit of Gartner.

"Toshiba's desktop business is small potatoes; they're moving from a defensive market position to no market position. It is not a surprise. At the volumes they were selling at, it might be more profitable for them to stop," Gammage said.

Toshiba had a 0.1 percent share of the U.S. desktop PC market in the third quarter of this year with 5,300 units sold, according to Gammage. Total market volume was 8.2 million, he said.

"Toshiba is primarily a notebook vendor, desktops is something they've been doing in support of their notebook business. Toshiba desktops are difficult to find, not products you can pick off store shelves. They haven't pushed desktops," he said.