HOME PC SURGE CONTINUES, TO 38.5% OF U.S. HOUSEHOLDS IN 1995

USED PCS PURCHASED BY 30% OF FIRST-TIME BUYERS, STUDY REVEALS

LA JOLLA, Calif., May 21, 1996 - Home PC use in the U.S. increased to 38.5
percent of households at year-end 1995, an increase of 5 percentage points
from the previous year, according to a new study from Computer
Intelligence InfoCorp (CII). CII found that PC-owning households tend to
have higher income, they tend to be more highly educated, they tend to be
middle-aged, and they are more likely to have children than non-PC
households. In addition, CII uncovered a significant jump this year in the
proportion of first-time buyers who purchased used PCs, to almost 30
percent.

The information comes from the 1996 version of CII's Consumer Technology
Index (CTI), the largest, most comprehensive survey of personal computer
usage in the U.S., which is being released to CII clients later this
week.

"For the past two years, PCs have been the electronic device consumers
want," said Dave Tremblay, Senior Industry Analyst at CII. "The number of
PC-equipped U.S. homes has increased by 13 million in that period, as PCs
have truly become a mass-market consumer product."

  U.S. Home PC Penetration by Year

    Year End 1993     25.7%
    Year End 1994     33.1%
    Year End 1995     38.5%

  Source: CII's Consumer Technology Index, 1996

CTI data indicates that children are an important factor in whether or not
a household owns a PC. Households with children are nearly half again as
likely (45 percent) to have PCs as are households without children. CII
noted that the number of children doesn't seem to have as large an effect:
45 percent of single-child households have PCs, while about half of
multiple-children households have PCs. (See table below.)

  PC Penetration in 1995 by Children in Household

  Children in household       Households with PCs

      None                        33.1%
      Any                         48.0%
      One                         45.3%
      Two                         50.1%
      Three                       49.1%
      Four plus                   51.0%
      Overall                     38.5%

  Source: CII's Consumer Technology Index, 1996

While home PC use has continued to grow, PC ownership is changing and
broadening to include more non-mainstream demographic segments. CTI data
shows that PC use is increasing relatively faster among lower-income
households than among higher-income households. Overall, 1995 household PC
penetration increased 16 percent over 1994. Yet increases (growth) in
household income segments above $35,000 ranged from 2 percent to 15
percent, less than average, while penetration in segments below U.S.
median income grew much more rapidly, at 20 percent and up.

Among the U.S. households with annual income above $40,000, the traditional
target of the home PC, 57 percent already have PCs, indicating that repeat
purchases will be more important to continued growth in these more mature
segments than first-time purchases. In fact, repeat purchasers
(replacement and additional) account for more sales overall than do
first-time buyers. This has not happened suddenly - CTI has marked the
decline in first-time purchases from 48 percent in 1993, to 45 percent in
1994, and to 43 percent in '95.

Noted CII's Tremblay, "As we reach higher saturation levels in the
traditional segments, penetration-fueled market growth is giving way to
replacement-fueled sales, which likely will cause a slowdown in sales
growth. The sales and penetration in 'off-target' segments can make the
difference between a market collapse and continued growth."

CII has also brought to light a potential complicating factor in the home
PC market, another incentive for PC manufacturers to continue to drive PC
prices down. For the first time this year, CTI has recorded significant
purchases of used PCs. Just under 30 percent of 1995 first-time buyers
bought used PCs, which represents a big jump from the 19 percent seen in
1994. CII believes that some of the PCs replaced by businesses in the
massive upgrade drive that took place during 1995 found homes in - homes!
Buyers of these used PCs are more likely to represent lower household
income categories, and are more likely to be first-time buyers.

CII's Consumer Technology Index study is the largest, most comprehensive
research effort focusing on personal computer usage in the United States.
An initial screening of 50,000 individuals identified PC users in home,
workplace and self-employed markets. Final survey results are based on a
detailed 12-page written questionnaire on the types and brands of
equipment used in the three markets, which was mailed to 17,500 U.S.
households. The survey also gathers extensive demographic information from
respondents and ascertains their future PC purchase plans.

Computer Intelligence InfoCorp, a Ziff-Davis Publishing Company, is the
leading source of fact-based information for the computer and
communications industries. CII's extensive research capabilities provide a
wide variety of products and services that help computer and
communications companies sell and market more effectively. All of the
company's products and services are based on proprietary information
databases built and maintained by CII specialists. Headquartered in La
Jolla, Computer Intelligence InfoCorp has offices in Cambridge, Mass.;
Farmington, Conn.; Mountain View, Calif.; and Europe. Samples of CII's
extensive market data and research results, timely commentary from
industry authorities and previews of upcoming technology events are
available on the company's site on the World Wide Web,
http://www.compint.com.
 
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