Microsoft's new mice and keyboards could increase the pressure on Logitech, particularly as the companies prepare for the lucrative holiday season, analysts say. In terms of retail mice sales, Microsoft and Logitech each had about 30 percent market share for the four quarters preceding the second quarter, according the market researcher NPDTechworld. But in the second quarter, Microsoft gained slightly, while Logitech fell dramatically. Microsoft had 31.1 percent market share compared to Logitech's 24.8 percent. "That's the best Microsoft has done in a while," Baker said. "But in the breakdown, Logitech did much better with cordless mice." Cordless mice accounted for 12 percent of the overall retail mouse market, according to NPDTechworld. But the category represented 27 percent of Logitech's mouse sales vs. 8.5 percent for Microsoft. "Logitech the last few quarters has been much more focused on cordless than has Microsoft," Baker said. "They've been able to jump out ahead, and if you look at average prices you see why you want to be in cordless." The overall average retail selling price for mice was $23, $27 for Microsoft and $30 for Logitech during the second quarter. But cordless mice average selling prices were much higher: $46 overall, $48 for Logitech and $59 for Microsoft. Logitech's bigger share here coupled with the higher margins and profits on the cordless mice in some ways puts Logitech ahead of Microsoft, Baker said. Microsoft also led over Logitech in retail keyboard sales, with 26.6 percent market share compared with 24.3 percent, according to NPDTechworld. But instead of losing share, Logitech has been steadily gaining on Microsoft, moving up about 5 percent share over the past three quarters. While cordless keyboards accounted for only 14.5 percent of the overall market, they represented a whopping 50 percent of Logitech's sales compared with less than 5 percent for Microsoft. "Keyboards have been very successful for Logitech in terms of this wireless thing," Baker said. Keyboards sold for an average $30 at retail, according to NPDTechworld. Microsoft keyboards sold for an average $39 and Logitech's models for $48. Wireless keyboards, on the other hand, sold for much: $70 overall, $68 for Microsoft and $72 for Logitech.
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