According to a recent survey done by Retrevo, a consumer electronics website, netbook sales aren’t doing so hot, mostly because of competition from the Apple iPad and cheaply-priced laptops. The study surveyed more than 1,000 U.S. consumers.
The Retrevo survey asked consumers whether they are planning on buying an Apple iPad or a netbook. An overwhelming 78 percent said they would choose an iPad while only 22 percent said they would choose a netbook.
The survey also asked consumers whether they held off on buying a netbook after they heard that the iPad would be released in a couple months. 70 percent of respondents said they would hold out, and 42.86 percent of these actually did end up buying an iPad, while 57.14 percent of these ended up purchasing a netbook. 30 percent of overall respondents did not hold out for the Apple iPad and originally moved forward with a netbook purchase.
The iPad has already sold more than one million units and there’s no doubt that iPad sales are still going strong. Two of its major advantages includes portability and relatively long battery life.
Even though consumer data indicates that the Apple iPad and cheaply-priced laptops are crippling netbook sales, analysts say that in the near future at least, netbook sales will not be greatly effected due to price-to-value differences. Guess we’ll have to wait and see how things really turn out. Don’t worry, we’ll keep you posted.
Netbooks have been steadily doing better with sales since their introduction, yet data gathered by Retrevo.com reveals a dark cloud looming over the horizon. Retrevo conducted a Pulse Study that asked notebook, netbook, and iPad owners what products they thought of buying this past year and what they finally chose. The study also asked what which products consumers are looking at and leaning towards.
It appears that netbooks are feeling the heat from both laptops and the Apple iPad. According to the study, 30% of potential netbook buyers ended up going with the iPad instead. Of course some percent of this market was expected to be acquired, but nonetheless a third is a substantial share. This is part of the manifestation of Apple’s almost cult status. The scarier part is that as far as it goes for consumers deciding between an iPad and netbook for the future, almost 80% are leaning towards an iPad!
Notebooks are also appearing to regain some of their share of the market that they began to lose to netbooks. Retrevo’s data shows that for both past and future buys, netbooks are less appealing to consumers than notebooks.
Despite this competition, netbooks should still always have a place in the market. In second and third world countries, they serve as cheap primary computers. Back here in the US, they still come at an unbeatable price as alternatives.
Via Retrovo, image via Retrovo
Netbooks have not been able to do too much in terms of cannibalizing notebook sales, and we have Intel to partially thank for this. Intel has imposed a limitation on netbook screen sizes, i.e. netbooks that are powered by processors in the Atom N series have been restricted to screen sizes no larger than 10.2″. This may change soon, as Intel may lift this restriction in the latter half of 2010, particularly with devices that are powered by the dual-core Intel Atom N550 processor.
Surprised? I’m not. Netbook sales have started to level off recently, so Intel is looking for a way to keep netbooks interesting. Some consumers believe that netbooks are too small to be efficient, so by enlarging the overall size of netbooks, sales in this area of the market would potentially be much greater.
In addition, ARM-based smartbooks with screen sizes larger than 10.2″ will be coming in the near future. Intel wants to keep ahead of its competition, so it’s loosening the restrictions on which netbook sizes their processors can support.
Of course, increasing the size of a netbook would further blur the line between such a device and a notebook, leaving us with one question… when is a netbook no longer a netbook, but instead an ultraportable or a notebook? Check out one of our previous articles for some details.
With the introduction of its Atom chip, Intel has been a significant player in the netbook market. Intel CEO Paul Otellini is optimistic about the future performance of this market. He see revenues and earnings from netbooks increasing from single digits this year to low double digits within the next few years.
According to Otellini, computers are in “a growth industry,” especially with the growth of the technology in emerging markets such as China, India, and Brazil. “We’re on top of a growth engine and we intend to deliver.”
What does Otellini have to say about Apple and the new iPad’s impact on netbook and notebook sales? Otellini believes that tablets and netbooks offer additional means for consumers to stay connected, “I don’t think they will take away market share from other devices.”
Really? We’ll have to see about that — only the future can tell. We’ll be sure to keep you posted on any new developments.
Before the Apple iPad was released, nobody knew what space it would compete for in the computer market. Would it replace a laptop? Would it compete as a netbook? Nobody really knew. After its April release though, it’s clear that the iPad tablet does indeed compete against, and in a significant number of cases can replace, a laptop unit.
According to March 2010 data collected by Alphawise, 44% of those buying iPad devices have decided to forgo buying a laptop as a result. Their main needs in getting a laptop were to check e-mail and to browse the web — things they can also do from an iPad.
Here’s a fancy chart showing Apple’s iPad cannabilization:
Not only has the iPad been cannibalizing laptop sales but it has also been cannibalizing netbook sales as well. The chart below shows the decline in netbook sales growth starting at the beginning of 2010. A significant amount of this decrease was rumored to be due to the upcoming release of the Apple iPad.
Now that the iPad’s out, think it’ll be able to avoid the same fate that has come of other computing products? Apple’s pretty good at innovation, so it’s very likely.
Intel did something right this quarter, despite industry-wide cutbacks following the recession. This quarter was one of Intels’ best ever, as the company saw 65% profit margins and spent more than $7 billion on new US chip plants.
Strong netbook sales were responsible for much of Intel’s success. Other companies delayed investments and product lines while Intel delivered its all-new Pine Trail processors. Netbooks were such a big boon for Intel this year because they didn’t seem to cannibalize processor sales or sales of more powerful computers.
Intel is expecting slightly contracted margins of around 61% in 2010.
PC sales are on the way up, according to a recent IDC Worldwide Quarterly PC Tracker report last Thursday.
After three consecutive quarters of decline, worldwide shipments rose 2-3% compared to the same period last year. Laptops soared an impressive 33.5% increase, while desktops continued to fall.
As a result of these developments, the overall PC market is expected to rise 1.9% in 2009, and a tremendous 10.3% in 2010. Netbooks are thought to be having a big hand in the PC industry’s turnaround.
IDC’s Loren Loverde mentioned what he thought explained the turnaround:
“Once again, the PC market shows its resiliency. The speed of market stabilization and growth in key segments reflect the essential role of personal computing today. Technology evolution and falling prices remain a compelling combination. As commercial spending recovers in 2010, we expect to see robust growth over the next several years.”
The specs of the 12.1-inch ASUS Eee PC 1201N netbook have been out for a while now, and they’re truly something to look forward to – 2 GB of RAM and 250 GB of storage on a machine selling for a mere $500. But while the netbook was anticipated to go on sale by December, that’s only a half truth – you can pre-order the Eee PC 1201N right now, but you’ll have to wait until January 15 for it to ship.
If you can stand the wait, get to it – pre-order your own ASUS Eee PC 1201N netbook here.
Target is announcing a new Sunday-to-Wednesday run of pre-Black Friday deals that we thought you’d like to hear about. The price cuts aren’t godly, but definitely worth a look if you’re on the market and don’t want to deal with Black Friday crowds.
Most of the good ones are on TVs. You can get a 32-inch LCD TV for $398, 50-inch plasma for $698 or a 42-inch 1080p LCD TV for $597.
Other deals include a $20 gift card with the purchase of a Wii, dual-screen portable DVD player for $119, and a 10.1-inch Acer Aspire One netbook for a mere $199.
You should be seeing these deals in your Sunday paper, or alternatively at Target.com in the near future.
Global CPU shipments have reached a record high of a 23% increase in Q3 of 2009, and this is largely a result of an increase in demand for netbooks.
While unit sales increased 23%, revenues only increased 14%, due to the low unit price of netbooks. According to Shane Rau, the director of semiconductor and personal computing research at IDC, “since PC processor shipments overall just slightly exceeded shipments in Q3 of 2008 – which was itself a record quarter at the time – we know the processor market is recovering.”
While this currently seems to be a good situation for netbook and chip manufacturers, we still have to be on the lookout. Rau pointed out that a lot of Intel Atom processors are being sold into markets like China, which offer government incentives. “The Chinese market can be very opaque – there are lots of places where inventories can hide. We have to be on the lookout for when China decides it can’t consume more processors. Meanwhile, the U.S. market is still hamstrung by housing foreclosures and rising job losses.”
Image via Crunchgear.
Netbooks have been selling fast, if you believe most recent projections, and today ABI supported those projections with some numbers of its own.
The netbook industry should top 35 million units by the end of the year. While ABI isn’t saying much about market share it did note that Acer, ASUS, and Samsung made 74% of netbooks last year. Of course, an upset is always possible.
Netbook sales have been flying high, despite losses in the PC sector. Some blame cannibalization for drops in profit margins, though others are simply grateful that people are still buying electronics.
Recent netbook sales have resulted in an increased shipment of Intel’s and Advanced Micro Devices’ (AMD’s) graphics chips. According to market research firm Jon Peddie Research, Q3 shipments of graphics chips increased 21.2% from Q2 of 2009. Jon Peddie, president of Jon Peddie Research is optimistic for the future, as a reported 119.45 million units of graphics chips were shipped in Q3, which is an increase of over 8 million units more than Q3 of 2008.
It’s possible that Q4 shipments for 2009 may not be as strong as Q3 though, as Peddie mentions that “The channel is full…That suggests that while Q4 is typically a good quarter for PCs, the quarter-to-quarter growth in Q4 may not be as robust as Q3. Graphics are a great leading indicator. The graphics go in before the PC is built or shipped.”
Intel CEO Paul Otellini acknowledges the growth of the netbook segment of the overall notebook market but says that, “while Atom and Netbooks are important growth drivers for us, our traditional notebook business remains one of the primary drivers of revenue growth and we expect that to continue in the future.” Otellini believes that both netbook and notebook sales will both continue to rise.
Otellini is also optimistic about sales of ultrathin laptops, relatively inexpensive alternatives that cost between $500 and $900 each and fall in the notebook category between netbooks and laptops. Various dual-core ultrathin laptops have already been released and much more will be released in time for the holiday season.
Microsoft CEO Steve Ballmer is quelling rumors that the release of Windows 7 will significantly increase PC sales. Though he doesn’t seem to doubt the excellence of the new OS, Ballmer says “There will be a surge of PCs but it will probably not be huge.”
Why? It’s hard to say for sure, because Ballmer isn’t telling. However, one likely explanation is that while Microsoft licenses its OSes to PC makers, it’s not tied to production decisions.
That isn’t to say that Windows 7 won’t make a tidy profit – a new OS release has been wanting for a long time. Additionally, a whole host of netbook computers are set for release around October 22. Most new PCs on the market are likely to run Windows 7 in the near future, and if that eventually includes netbooks, Windows 7 could be tremendously successful.
As prices drop in the PC market due to competition by netbooks, the demand for netbooks has been a tremendous boon for the rest of the tech sector. Chip stocks seem to have felt the greatest effect so far.
Gartner recently reported that the worst of the recession may have passed for PC makers. With netbook projections initially set at 21 million, Gartner raised the number to 25 million for 2009.
iSupply analyst Len Jelinek has corroborated Gartner’s findings in an email to TheStreet:
“Intel with its Atom processor is definitely increasing sales and is poised to continue growth as they drive technology and performance with their next generation technology.”
Here’s a handy tip for all you netbook lovers – check out Amazon’s netbook section on their site. It’s a fantastically simple way to browse netbooks, check out ratings, and choose a model without having to open up a million tabs.
According to market research firm Gartner, PC shipments for 2009 should be roughly 285 million units – two percent lower than last year’s 291 million units. This estimate is an improvement over the mid-year forecast though, which was an overall decrease of 6% for 2009.
According to Gartner’s research director, George Shiffler, the improvement in the forecast stems from mostly notebook and netbook sales in China and the United States. “Mobile PC shipments have regained substantial momentum, especially in emerging markets, and the decline in desk-based PC shipments is slowing down. We think shipments are likely to be growing again in the fourth quarter of 2009 compared to the fourth quarter of 2008.”
And now that the economy is slowly starting to pick up again, who knows what might happen? We’ll keep you posted.
Intel first released the Atom chipset back in March of 2008 in an attempt to break into an industry that the famous chip manufacturer had little presence in. As a consequence, Intel has also implicitly spurred the rise of a new category of portable laptops, or netbooks, that are relatively low-cost and energy efficient and have been widely used for basic everyday tasks.
Since then, netbook sales have grown significantly and market research companies have forecasted greater growth within the overall industry. Market research firm IDC has forecasted the sale of roughly 26.4 million units globally for the year 2009 and says that telecoms that subsidizes these devices have contributed to a large portion of overall sales.
Taiwanese stock market projections by some analysts are expecting good things for Taiwanese netbook manufacturers, according to Bloomberg.
Portfolio manager in Taipei of First Financial Investment Trust Co. Jacky Cheng explained quite simply why netbook stocks are likely to rise:
“In a bad economy, everyone is switching to the cheaper netbooks.“
Taiwanese markets took a hit after the July 28 arrival of Typhoon Morakot, Taiwan’s deadliest storm in half a century. Nevertheless, the Taiex index has seen unbelievable gains of 49% this year.
According to DisplaySearch, 2Q 2009 was lucrative for netbook industry giants, with 38 million netbook sales contributing to 22.2% of the PC market.
Demand grew 40% over the first quarter, compared to 22% growth over the same period by notebooks.
Growth wasn’t identical among all regions, however, with Latin America and China seeing the most gains. Many first-time buyers in those regions are opting for cheaper netbooks in the current tough economy.