Submitted by In the current economic climate, it’s hard to make any sane predictions one way or the other. While we receive continuous reports that netbooks are the saving grace of the PC market, the light at the end of the tunnel, the beacon of hope, the Fiona Apple among the rest of the mediocre musician crowd, the, err, (okay I’m out of metaphors), we are now getting a report which states that during the first quarter of 2009, netbooks have not met their sales estimates.
The report comes courtesy of DigiTimes, which usually comes with inside information about manufacturers in the far east (well, far east from my perspective, anyway). For instance, Acer had expected to ship 2 million Aspire One netbooks during Q1 of 2009, but sources claim sales in the channels were lower. The same sources also claim that Asus only sold 900000 Eee PCs during that same quarter, short of the 1 million projected. MSI reportedly sold 200000 Wind series netbooks. The story claims that market saturation might account for the lower-than-projected sales.
The figures are vague, and there’s little to back them up at this point. Still, Intel did reveal they saw a slowdown in the number of Atom chips sold during the first quarter, which may corroborate this DigiTimes story. Still, not beating expectations is not that big of a deal, considering the insane growth the netbook market has seen so far – even during Q1 of 2009.
Another interesting story on DigiTimes has to do with Intel’s new and upcoming Intel GN40 chipset for netbooks, accompanied by the Atom N280 processors. This chipset comes with increased 3D capabilities and hardware video decoding, but Windows XP will not be able to take advantage of this because the chipset relies on DirectX 10 and DirectX Video Acceleration 2.0, which are Vista-specific technologies. Windows XP does not make use of these new capabilities – you’re going to need Windows Vista for that. Netbook makers confirmed the issue.
It seems as if Windows XP is finally starting to show its age. I won’t make myself popular here, but I’m happy for it. XP’s time has come and gone, and it’s time the world moved on to more secure operating systems like Windows Vista and Linux.
1. Apple must be so sad that they are missing the savior of the PC business wave. Seriously, 900,000 EeePCs at what profit margin?
2. I feel fine about having upgraded to MacOS X. It’s a viable route and a fine operating system.
I personally think that netbooks will mostly be sold to two type types of customers. Those that really want a really small portable computer, and those that end up being quite disappointed because what works fine on a desktop monitor doesn’t work quite as well on a really small laptop monitor.
I think that a lot of people have understood that they can hook an external monitor on a netbook. In that case, the netbook is still a great solution because it’s damn cheap and as a bonus you can take it with you anywhere — even if it’s not your main usage, it’s good “just in case”. Much like a lot of people buys a notebook instead of a desktop, not much because it takes less room in the house but because they can take it with them if necessary.
The same could be said about the missing DVD reader: you can add it cheaply and it won’t encumber you when you travel.
In my point of view, the biggest risk of disappointment is about the CPU. The Atom is really great for common day usage, but if the customer wants to play the latest PC games and to surf heavy flash websites, she will be disappointed.
Things like movie editing are not really a problem for the Atom, because it will work, albeit slowly — it is not a real-time task like the games; it will disappoint you only if you are used to work on a faster machine — but in that case, would you buy a netbook to do that? No, unless you plan to do it on the go, in which case you choose this compromise. But then you’re already the kind of people who buy a netbook as a second computer, not the main one — and netbooks can’t disappoint as second computers in my view.
I agree. If someone approaches a “netbook” with the philosophy of it being a PDA-like device, they’re likely to be thrilled with their purchase. It’s like a Dell Axim except it runs a full OS, has a screen that’s 4X larger, and costs half as much.
But if someone buys a “netbook” with the intention of using it as a primary computer, they’ll be sadly disappointed. Miniature screen, substandard-sized keyboard, poor tactile feedback, missing optical drive, poor expandability options…
Of course there is still people without netbook who may buy one. But most of the potential buyers already bought one.
And, excepted for geeks (and maybe for the most spender, or netbook “fashion victims”), people do not buy another device right away.
Unless their current device breaks. But most netbooks seems to be quite resilient 🙂 Mine’s, at least, supported orange juice with no problem!
Or unless they feel the current device is obsolete. Most owners of the EeePC 701, with the small 800×480 screen, would happilly buy some 1024×600 device. But excepted for the 701 and this low-res screen, most netbooks are really fine and there is no really need to upgrade. Even the 701, actually, is still very handy, the 800×480 display is just not convenient.
Furthermore, I think that most people that would upgrade their netbook would donate or sell their previous netbook to somebody else, so it wouldn’t help the saturation of the market.
There really is only the geeks to buy and own several netbooks…
About broken netbooks: if the device breaks during the warranty, it’s well possible that there is no need to buy another device. And Asus netbooks have a two-year warranty… (in Europe at least) While the netbook market is barely 1 year and half old, depending on where you live. The market is only 1 year old if you don’t cound the 701 and only takes into account the 9 and 10 inches devices — which is where the market really took off.
No, really, I’m not surprised that in only one year the market is already saturated.
It’s all hype that didn’t work. Just wait for Apple to kickstart the netbook biz even if it only means bringing the awareness into the minds of consumers.
And you conclude that from an unconfirmed rumour?
The only facts we have so far is that up until now, the netbook market has seen insane growth figures – in fact, having a good netbook offering has been the difference between an increase in sales, or a decrease in sales in many cases. Even on Intel’s balance sheet, the Atom business has been the only bright spot in a sea of misery.
I love how the Apple fans jump on top of this as proof that Apple was right all along. Just like in a few years, when Apple finally ships Macs with Blu-Ray, all the Apple fans will proclaim that it was Apple who “saved” Blu-Ray.
Going from non-existent to 1000’s% growth is easy in a year, when nothing existed before then
Now, about the total number of netbooks, well, just how many were there? Next, how many iPhones and iPod Touch units were sold in that time? Sure, they didn’t increase several thousands of percent sales-wise in that time, but they have sold millions, and continue to sell millions, and have proven that there’s a viable market for them: the netbook (as people are calling these, much to the trademark owner’s chagrin) hasn’t been around long enough in the market to demonstrate that it will have a long lasting sales curve of great numbers before saturation is reached. I’m not saying they won’t continue to sell millions per year: I’m only stating that they don’t have a long enough actual history to demonstrate that you can conclude anything from the sales to date, along with their sales growth, to state how good/bad/ugly their success will be long-term. After all, if one extrapolated from the sales of the Pet Rock in the 70’s (bah, you were nothing more than an accident waiting to happen at the time they were conceived and out and about, and you likely weren’t even thought about by your parents at that time, if they even knew each other yet) shortly after they started selling, you’d logically conclude in the same manner as you are for netbooks that everyone and their dog, all over the world, would have one. But, no, that’s not what really happened: it was a fad created by a marketing executive that still made him millions of dollars selling gussied up construction pebbles with a story. So, the real question that hasn’t conclusively been answered yet: are netbooks as we currently see them exist a Pet Rock, or a ChiaPet? (I have no clue if the latter is sold as widely outside the US as a netbook is, but they’ve been selling those since I was a little kid and have even come out with Obama ChiaPets)…
You got me all wrong. I mean WHEN and IF Apple decides to enter the netbook market then it will be kickstarted. Probably not sooner.
Hey, I LIKE Fiona Apple Thom, just because you have no taste in music doesn’t mean that you should diss her.
Diss? I think you need to re-read the little blurb.
Me dissing Fiona? Yeah right. I don’t diss my god. Fiona= god.
I’m pretty sure Thom likes Fiona too.
Till chipzilla gets it that OEMs need more options than the artificially limited range of CPUs and chipsets shoved down their throats, there isn’t going to be much growth.
There sure as hell a market for Dual-Core netbooks with 4GB RAM options. Lack of market interest is merely an excuse and it doesn’t fly as the HP dv2 and dual-core nettops have demonstrated otherwise.
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Edited 2009-04-23 06:02 UTC
I hope you realise that there are dual core Atom’s out there – it is the OEM, not Intel or any other boogieman, who is making the decisions whether to go in one direction or another.
Netbooks will really come into their own once we see more 10″ and 12″ models come out which will replace most people’s laptops – until then, try marketing to a person why they should keep the laptop as well as purchasing a netbook.
I have an iMac and a MacBook – where does a Netbook fit into the equation for me? for many people, their lives are already flooded with computers already; if they’ve got a computer already they’re looking for a replacement and out of that, the screen size for many are too small to make it a viable full time device to be used. Those who don’t use computers have had many years and chances as prices have plummeted to purchase one so the issue has nothing to do with price as to why they, as the computerless, haven’t bought one yet.
If you have a look at my comment again, you’ll notice that I was referring to dual-core netbooks. As far as I can tell chipzilla is the culprit limiting this segment. Also what is the deal with the 2GB artificial limit? I have yet to see any reports from OEMs or insiders claiming that there is negligible demand for a netbook with dual-core and support for 4GB RAM.
Having a monopoly on the netbook market and stalling it from flourishing into many segments is merely limited by their profit margins and conflicting portfolios. There are no technical limits here.
FYI, HP is shipping the dv2 that comes with 4GB RAM. The dv2 is built on AMDs Neo netbook platform. Thus I doubt the OEMs are against this concept.
I have a 17″ MBP which I use for vision research and offsite client demos. When I am on vacation, I would like to take a light 12″ netbook that has good response when I need to multitask. Like when I need to VOIP into a conference and share a presentation at the same time, or when I have to VPN into my home office to download my mails.
Having a netbook that has a beefier CPU and more RAM helps a lot in the above circumstances. I am not alone on this, I have friends that are business owners and part-time workers that are college students that would greatly benefit from this.
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Edited 2009-04-23 08:30 UTC
And again I state for a second time that there are dual core Atom processors available:
http://en.wikipedia.org/wiki/List_of_Intel_Atom_microprocessors
The 300 series is dual core and hyper-threading. Again, it is the vendors and not Intel restricting. There is nothing stopping a vendor from installing a nettop processor in a netbook – it’ll use more power – 8W versus 2.5W, but there is nothing stopping them from doing it. Do you have evidence in the form of a contract which limits OEM’s? you seem make claims that there are limitations – have you got evidence besides accusations?
Intel are making the processors available and OEM’s are choosing not to provide dual core Atom based Netbooks. I’d put money on it that the don’t provide netbooks with dual core because it would eat into their traditional (and higher margin) laptop segment.
It is a business decision made by the hardware vendors and nothing to do with the so-called ‘chipzilla’ that you keep screaming about.
Again, that is a choice made by the vendor and not Intel. Again, you’re looking for someone to blame because you can’t find what you want. You’ll make up boogiemen if it means that you end up having something you can use as a whipping boy.
They have no monopoly – VIA is coming into the market, AMD is entering the market – how is it Intel’s fault that both vendors are late to the party? Again, you seem to be hell bent on looking for something to hate.
Again you given an example of a competing platform and yet you aren’t able to actually demonstrate why there is such a limitation with the Atom platform – if it is a limitation by design or a choice by the OEM. You’ve failed to show one causes the other. You’ve also ignored the fact that the margins on Atom processors are actually very good – so it isn’t as though intel is doing something to protect their margins.
Why haven’t OEM’s gone with the Nvidia chipset then if the Intel one is so limiting? why haven’t OEMs gone with VIA or AMD on mass if Atom is so limiting. Again, you’re looking for something to hate because you just so happen not to be able to find what you want. This is a forum for technology discussions not a soap box for ranting over your desires not being addressed by the marketplace.
Edited 2009-04-23 11:03 UTC
Nettop parts consume more power which is why they are not used in netbooks. These parts also produce more heat.
You are welcome to prove me wrong by listing any OEM that are shipping nettop parts in netbooks.
Netbooks would require mobile variants to be successful. Therefore the emphasis on Atom mobile variants with dual-core capability.
Please post some facts on this.
How does one scream in a comment? Care to share?
OEMs can purchase the Atom without the chipset. However, Intel’s pricing strategy makes it uncompetitive to bundle another chipset. You can read about it here:
http://www.tweaktown.com/news/11605/intel_s_atom_can_be_purchased_w…
Again, please post your facts. Also, I would like to know which vendors are making such deliberate choices so that I could avoid their products.
I have yet to see your facts to the contrary.
Monopolies are about making as much money as possible while staying in control of the market, even if it means screwing their customers outright. If you think Intel is an exception to this, you might want to read up on their anti-trust lawsuits.
Furthermore, why do you put the blame on OEMs when the facts are to the contrary. Why make the OEMs your whipping boy?
VIA was the first to market. Like AMD, their weakness is their supply and pricing strategy.
I do hope AMD would be able to ship more Neo class processors (especially X2 variants if possible). Beyond being price competitive with Intel, they do have a challenge in maintaing low TDP and heat.
Very few could beat Intel at pricing and supply. That advantage alone has given them a strong monopoly in the market despite many other x86 contenders. If you think Intel isn’t a monopoly in the x86 market, you ought to post some facts to back that up. By the way, in case you are not aware at this point, Atom is an x86 product.
If by platform you mean CPU + chipset, then yes, it is an artificial limitation imposed by Intel on the Atom platform. Read here for the chipset specs yourself:
http://ark.intel.com/ProductCollection.aspx?codeName=24973&code=pou…
As you would notice from the link above the maximum RAM supported is 2GB. This is not an OEM restriction as you have implied. What facts do you have to blame the OEMs?
Again, if you read my prior statements in this comment. You would come to the realization that Intel has the supply and pricing advantage which neither of them have at the moment. This advantage has given them the monopoly position they currently have.
If it was easy to break any monopoly, then the chipzillas and the microshafts of this world this world would cease to exist.
My initial comment (before you came along with your reply) was to point out that the lack of sub-segments within the netbook marketplace is impacting its growth. After your reply, I shared my view on how having more RAM capacity and dual-core options would open up opportunities for customers like myself.
I don’t recall you being neither the moderator nor the site owner to impose restrictions or limits on my freedom of expression. You are welcome to delete my comments if you think that is your purview.
Thanks,
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Edited 2009-04-23 14:50 UTC