Dell is Selling the “Appropriate” Number of Netbooks
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Steve Felice, the President of Dell’s consumer and small and mid-size business unit, recently said that, “There’s been some over-exuberance on this product (netbooks) in the marketplace. Some of our competitors have positioned [netbooks] as a replacement device and then you see feedback from customers that are disappointed when they gave up their notebook for a netbook and find that it’s not quite as fast or doesn’t have quite the same functionality.”
Unlike their competitors, Dell has not been a strong proponent of a netbook as a laptop replacement, and their foresight is right on target. According to shipment figures reported by IDC this past April, there has been waning enthusiasm for netbooks in favor of higher-performance laptops. Intel Atom‘s share of the market has fallen to 20 percent during the first quarter of 2010 from 24 percent during the previous quarter, despite the fact that the overall volume of processors shipped rose by 4.1 percent.
Stronger demand for laptop technology is a blessing for Dell. The company’s first quarter revenue in 2010 rose 21 percent to $14.9 billion and profits rose 52 percent to $441 million. Dell did especially well in emerging markets like China and Brazil, where revenue rose 90 and 81 percent, respectively. Felice says, “We are very pleased with the overall performance of Dell.”