Is the netbook fad set to fizzle?
By Dave Jeyes
At the end of last year, netbook sales were buoying the larger PC market as consumers scooped them up in droves. However the first quarter saw dramatically lower demand, raising questions about the new devices’ staying power.
Sales of netbook computers dropped a hefty 26 percent in the first quarter this year from the previous quarter. That’s a grand total of 5.9 million netbooks sold through March down from 8 million at the end of last year.
The lower sales were foreshadowed by lower semiconductor demand seen globally in the first quarter. Semiconductor sales were off 16 percent year over year and 30 percent year over year during the same period.
Buyers of the smaller and lower powered variant of the laptop are likely to fall into two categories. Either new buyers are looking to replace a laptop with a more affordable model or adding an additional PC to their collection.
During a down economy, the largest area of opportunity for netbook makers lies with appealing to bargain hunters. However these sales erode the major companies’ standard laptop sales in the long term.
On the other hand, consumers are less likely to purchase additional devices as this could generally be considered a luxury. This is an area that many of the companies would like to see continued growth, but has likely been adversely affected by the economy.
With the entire PC market’s sales down in the first quarter, it’s hard to say whether the 26 percent drop is due to the economy or netbooks’ long term viability. Netbooks are still relatively new technology and haven’t hit the broad center of the market just yet.
The semiconductor industry is starting to see a recovery, with month over month sales from growing 3.3 percent in March. Now the next two quarters could be very telling as to whether netbooks are just a fad or here to stay.
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May 14th, 2009
I think netbooks have staying power if (1) prices can come down a bit and (2) performance can creep upward (RAM, speed, HD). I personally think netbooks need to be more in the $300 range consistently to increase their current market share, and that will happen only once solid state drives and more powerful chips can be had for less.
The point to a netbook is not to replace a larger machine but to simply be able to do e-mail, light word processing and spreadsheeting, and Web surfing when you’re on the go in cramped quarters. They are properly viewed not as a competitor with laptops and desktops but with smart phones, iPhones, etc.
I suspect the Apple foray into netbook land will stimulate the market in new directions again. We’ll have to stay tuned.
May 14th, 2009
Or it could be retailers are trying to draw down inventory with smaller reorders.
http://www.osnews.com/story/21492/Atom_Sales_Drop_Netbook_Share_Increases_What_s_Going_on_
Netbook sales were blistering hot and are possibly just taking a breather while the newer processors and screen tech like the Asus touchscreen.
http://tech.blorge.com/Structure:%20/2009/05/12/asus-eee-pc-t91-touch-netbook-pricing-revealed/
It’s a mistake to think of Netbooks as low rent laptops, or high rent smart phones. As Dave wrote in the Asus article, adding TV tuners and touchscreen keyboards for media on the go make them Touch and Kindle type devices.
Apple might try to position their possible Netbook entry with smartphones, it’s going to be tricky to hold margins in Macbooks and a Netbook price point. It would be foolish to write Apple out of the Netbook niche.
July 23rd, 2009
HI THERE YES THE THE NETBOOK IS GOING TOO FISEL OUT BECUASE THEY ARE TOO SLOW AND CAN NOT DO MUCH I CAN USE MY SAMSUNG SPRINT INSTINCT CELLPHONE MY NINTENDO DSI OR WII TOO THE SAME THING WITH OUT THE SLOWEST HARD DRIVES ON THE MARKET SENCE NONE USE HYBRIDE FLASH SSD WITH HARD DRIVE NO TURBO MEMORY OR NO SSD