Ultra-compact, ultra-inexpensive notebooks – just what kind of market is this?
Ultra low-cost notebook systems have been all the rage these days thanks to the recent success of ASUS EeePC and the release of the HP Mini-Note but what kind of market is this really going to be? Well the folks at IDC have released an interesting research note about how big this market might become and how it will ultimately fit into the overall PC market. According to Bob O’Donnell, vice president of Clients and Displays at IDC, “Consumers have embraced the idea of the PC, particularly the portable PC, as a personal device rather than a shared household device” – leading to a device that he calls “the first disposable notebooks.”
Now there’s an interesting thought – disposable notebooks – and you know? It makes perfect sense actually. Compare this market to the mobile phone market where you have a somewhat similar dynamic. You have inexpensive low end phones that are often subsidized by the mobile carriers that do just enough for a consumer and then you have the high end smartphones that come with everything but the kitchen sink. Consumers certainly don’t treat smartphones as disposable phones unlike the low end tier of phones. How many of you are going to really care if you lost that $99 dollar phone of yours? Let’s face it.. the real reason you would care is because you lost all the phone numbers in the address book and you forgot to back it up!
Thus with the notebook market, we have a similar dynamic setting up. You have inexpensive, yet full featured notebooks encroaching the $500 dollar range and then you have these new ultra-compact, ultra-low cost notebooks that are in the $400 dollar range that do just enough. They have full OS’s, they have the speed and capabilities to satisfy most users, and they’re compact. IDC’s definition of one of these notebooks is as follows:
“a sub-$500 clamshell form factor mobile PC with a screen measuring from 7-10 inches diagonally, running a full operating system capable of supporting third party applications, and possessing a keyboard and wireless broadband connectivity”
According to IDC, these sub-$500 dollar notebooks will fit best as “secondary computing devices”. If you need to get some minor work done, surf the web, look at pictures, check email, etc, then carry around your cheap disposable compact notebook. If you need to do heavier compute intensive tasks, then work on your main laptop or home desktop. In fact, IDC believes the area where these ultra low-cost notebooks will make the most impact is in the school age (K-8) market. This is certainly the logical market for these systems but I also believe the mobile professional will want these secondary devices as well. If I could have a 2 pound notebook that lets me simply surf the web and write email and documents, then I’d be pretty much all set for 80-90 percent of my work.
Finally, some numbers. IDC believes that the market will grow to 9 million units by 2012 but worldwide revenues will probably only be around $3 billion or less. Why? These ultra-compact systems are ultra-cheap thus gross profit margins will be extremely slim if nearly non-existent.
Related Posts:
