Microsoft’s Windows 7 operating system was expected to help boost the profits of the PC giants Hewlett-Packard Co., Dell Inc., and others, but the end result is that the OS has only increased the profits of the Redmond-based giant. Laptop prices fell more than 23% year-over-year compared to the same quarter, resulting in an average price of $581. The increased sale of netbooks may have something to do with this, as well as more sales of $500-$700 laptops.

Deep discounts were given, although quarterly revenue is still much lower than in the 2007-08 time frame. Sales at electronics retailers like Best Buy benefitted from the surge in new customers with the arrival of Microsoft’s latest operating system, but largely, shipments vs. revenue has not been great for the PC manufacturers.

Apple, on the other hand, posted record earnings last quarter, and research firm NPD now says that, of computers priced at more than $1,000, 90% of all sales were directed towards the Cupertino-based company. This is an indication that not only are people continuing to buy Apple products (which are perceived to be much more expensive than the Windows counterparts), but they are stealing some of the profits from the PC manufacturers like HP and Dell.

However, while Apple is seen to have benefitted from the recession as more people turn to quality over affordability, the average selling price did slip from $1,499 to $1,361, but this could also have been due to price cuts on the high end of their product lines.

It would be interesting to see how Apple’s mobile phone and multimedia player line (including the iPad) are further able to shape the pricing of the competitors’ products.

At any rate, other PC manufacturers only wish they had the market that Apple is in. My guess is that their lineup of premium products aren’t selling too well—3.36 million Macs were sold in Q1 2010, indicating that PC manufacturers only sold about 10% of those.