Excerpted from Business Week, “Netbook Sales May Be Cutting Demand For Laptop PCs”, November 26, 2008
Manufacturers and their suppliers are worried that soaring interest in netbooks is cannibalizing PC and laptop sales
Some consumers are opting for a pint-size $300 device known as a netbook instead of a traditional laptop, which normally costs at least twice as much.
This year millions are expected to buy netbooks, a relatively new family of cheap, light PCs that can handle Web surfing, e-mail, and other basic tasks. Netbooks are one of the few bright spots in the tech industry. But their success may come at a cost: In some cases, pinched buyers are choosing netbooks instead of more expensive laptops—a potential problem for manufacturers because netbooks are typically less profitable than their bigger cousins.
PC makers originally thought a netbook would serve as a person’s third computer, complementing PCs in the home and office. But 10% to 20% of netbook buyers would have bought more expensive laptops or desktops if netbooks weren’t available.
Sales of netbooks exploded this year to an estimated 11 million, up from 182,000 last year. Analysts expect their popularity to rise as more computer makers introduce products and drop prices.
“[Netbooks are] the classic disruption: A cheaper, less capable competitor comes into the market and takes over.”
Netbooks typically cost $300 to $500, but prices may slide … to as little as $100.
Netbooks are already putting pressure on PC prices. IDC estimates the average selling price for a portable computer will drop 8% this year, to $1,018, and an additional 12% next year, partly because of netbooks.
Full article:
http://www.businessweek.com/magazine/content/08_49/b4111064905299.htm?chan=magazine+channel_what%27s+next
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