The International Business Machines Corporation has begun to aggressively target the school classroom, a market that even its spokesmen concede was once virtually ignored and left to competitors.
Ibm has almost tripled its sales of instructional computers in recent years, according to market analysts, and has moved into second place behind the field’s long-dominant leader, Apple Computer Inc.
By one estimate, ibm will have increased its share of the market by more than 156 percent between 1986-87 and the end of this school year--a feat characterized by a commercial tracking firm as “the most striking growth of all manufacturers in market penetration.”
While no one is predicting that the ibm surge will soon threaten Apple--a company that accounts for almost two-thirds of the classroom computers in use in the United States--some are noting that a confluence of forces is making the school-computer market a highly volatile one.
And ibm, whose market inroads include some of the nation’s largest school districts, appears to be ready to exploit that volatility.
“The word is getting out that ibm has its act together in the education market,” said Charles E. Steele, the area manager for ibm Educational Systems in New York. “We’d like to be the vendor of choice”
Competition Heats Up
The appearance of a new player in the field also is welcome news for some school computer professionals.
“I have a real problem that one company has dominated, so to speak, the educational market. I think that fosters a lack of creativity,” said Marilyn Gardner, director of technology development for the 59,000-student Boston school district. “I’ve seen that with Apple, they’ve kind of sat back on their heels.”
Boston has made a large commitment to ibm on the basis of its “educational support,” she added, noting that the appearance of different types of computers in the clasroom “has made our teachers a little more flexible when it comes to technology.”
Spokesmen for Apple, however, pointed to a recent company survey indicating that it continued to increase its share of the market, among 5,000 selected schools, from the low 60 percent range to the high 60’s during the 1987-88 school year.
That survey found that i.b.m.'s share of the market in those schools dropped during the same period, said Sandra Bateman, a representative in Apple’s K-12 division. On the other hand, 90 percent of the 5,000 schools polled by the Sealed Research Corporation had at least one Apple computer.
But James Dezell, general manager of ibm Educational Systems, is unfazed.
Managers in his 12 regional markets are using a coordinated sales program that concentrates on such popular products as the “Writing to Read” program and volume discounts to customers who buy in bulk. They also offer districts help in developing long-range plans to meet technology needs and training programs conducted by teachers for teachers.
Apple has a similar commitment to educators, its officials point out, including grants to needy schools, a network of former educators who serve as regional advisers, and other computer-literacy programs.
Spokesmen for both companies, however, noted that increased computer savvy among their school customers has been a major factor in improving sales.
“We find our users are much more sophisticated,’ said Ms. Bateman of Apple.
According to ibm’s Mr. Steele, “You’ve gotten a maturing of these customers and a better understanding of what the technology can do.”
Room for Growth
Spokesmen for the two companies also agreed that there is ample room for growth in the precollege market.
One indicator is that, despite the fact that the preponderance of computers already installed in schools bear the Apple brand name, ibm was able to “almost double its market share in sales, taking 22 percent of 1986-87 sales,” according to “The K-12 Market for Technology and Electronic Media,” published by Link Resources of New York.
The Link information was based on responses received from an October 1987 mailing of 5,000 surveys to principals nationwide. The principals were asked to provide certain financial data, then pass the questionnaires along to teachers “most involved” in instructional computing.
“Now that ibm has a machine specifically designed for the school market in the Model 25, it can be expected to be even more aggressive in the pursuit of K-12 sales,” the report on the Link survey indicates.
According to Mr. Steele, the company aspires to be a major force in lowering the ratio of students to computers from its present level of approximately 30 to 1 to perhaps as low as 4 to 1.
Peggy Bruckner of ibm suggested that the ideal ratio for her general manager, Mr. Dezell, would probably be “two computers for each student"--one to use at school and one at home.
But Mr. Steele conceded that to achieve a school ratio in the 4-to-1 range, “a realistic time frame, to me personally at least, is five years.”
Important Choices
The stakes for educators in the increasing competitiveness of the technology market may be considerable, according to observers. They note that choice of brand in computer-buying will remain significant as long as an incompatibility between machines makes using them in tandem difficult.
Software for ibm equipment, for example, uses the business standard ms-dos operating software, which cannot readily be used on Apple equipment.
Researchers are working to achieve compatibility between ms-dos and other program formats, with some products already available. And both i.b.m., which has its own educational-software division, and Apple, which is spinning off a software-producing company called Claris, are working to produce high-quality programs for their own machines.
But for school districts, which make large-scale acquisitions of software, compatibility remains an an important factor in computer purchases.
According to Jeanne Hayes, the editor of “Microcomputer and vcr Usage in Schools,” published by Quality Education Data of Denver, selecting machines by brand will become increasingly important now that--as the company’s survey states--"the use of microcomputers in schools has become institutionalized.”
“Schools now have enough hardware that the cost of software is becoming significant” to them, she said.
According to a spokesman for Link Resources, “there really are only two computers now in the educational market, Apple and ms-dos.”
Aging Equipment
Of equal importance is the fact that some school computers now in use are aging, according to a survey of 860 school computer and video coordinators conducted last June by qed
Drawing on the 113 responses collected, qed concluded that “more than half of the computers in the survey are between 3 and 4 years old, suggesting a need for capital expenditures for replacement equipment in the near future.”
According to figures compiled by Link Resources, Apple computers accounted for 60 percent of the 458,000 units sold during the 1986-87 school year.
Ibm, however, was second with 22 percent of overall sales, according to the survey, with Tandy following as a distant third, accounting for 14 percent of the new computers sold.
Of the 2.03 million computers in use in the schools during that year, ibm accounted for 11 percent of the 1.68 million in public schools and 10 percent of the 345,000 in private schools.
Large-District Sales
Qed, which annually surveys all U.S. public and private schools by telephone, has found that ibm’s successes fall disproportionately in the 173 largest school districts, where it often has already established a considerable presence in administrative uses of computers.
Its latest report says that the company has “almost twice its normal market share in these 173 largest districts, reflecting i.b.m.'s aggressive placement of micros in such large districts as Boston and Washington.”
That market, qed’s research indicates, is a particularly lucrative one.
“These 173 districts, with more than 11 million students, have 30 percent of the current U.S. installed computer base,” according to the study.
Qed’s listing of districts by market share indicates that in some school systems, there were 10 times as many i.b.m. machines as those of its competitors.
The company’s Mr. Steele explained this by saying that “the larger the account, the more resources [there are applied].”
In many cases, he said, large districts, or consortia composed of smaller districts, are offered discounts as high as 40 percent over normal retail prices to buy i.b.m. equipment.
In the District of Columbia, for example, 2,200 of the 3,845 microcom4puters in use were i.b.m.-manufactured, compared with 75 Apples, 670 Commodores, 500 Ataris, and 400 unnamed brands.
Jenelle V. Leonard, director of computer-literacy training for the district, said compatibility was a factor in maintaining the system’s preponderance of i.b.m. equipment. The district awarded a contract to ibm in 1985, she said, and decided to continue its commitment to ms-dos machines last March, when another open bid for computers was awarded.
In awarding bids, she pointed out, “you look at the performance record and you look at the compatibility in the schools.”
Market Volatility
Another district with a large investment in i.b.m. equipment is the Plano (Tex.) Independent School District, which reported that 3,040 of its 4,373 computers were manufactured by i.b.m. The district also owns 1,200 Apple machines.
But Bill Adkins, director of instructional technology for the 28,000-student school system, praised Apple’s machines as highly durable and said that the major factor that weighed in favor of purchasing i.b.m. products may be changing in the volatile climate of the microcomputer industry.
When the decision was made two years ago, he said, the district was embarking on a long-range plan to link its computers in a network that would, by 1992, connect all of its schools, administrative offices, and computer laboratories.
“It didn’t boil down to actual hardware studies,” Mr. Adkins said. “It was the total system that we were looking at at that time. I.b.m. was the company that had the networking.”
The district will soon purchase more computers for its instructional program. And while i.b.m. products have been “satisfactory,” Mr. Adkins said, Apple has recently announced a networking system of its own--"Apple Talk"--that may fit the bill just as well.
Ms. Leonard added that although the Washington schools have made a substantial commitment both to i.b.m. and to ms-dos, the computer market is unpredictable and the next round of purchasing may produce different results.
“Each time, it becomes a new ball game,” she said, “because it really depends on what the state of the art is then.”
