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Acer America
Acer America Corp. is a computer manufacturer of business and consumer PCs, notebooks, ultrabooks, projectors, servers, and storage products.


333 West San Carlos Street
San Jose, California 95110
United States


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July 16, 2012 |

The Demise of the Netbook: We Hardly Knew Ye

Rising sales of tablets and ultrabooks are slowly rendering netbooks all but obsolete.

Size matters, and in the case of mobile PCs smaller is better. For this reason, netbooks turned heads in the late 2000s with their promise of compact form factors and low prices. Today, though, with full-function laptops becoming slimmer and tablets making gains in capability, the netbook category is steadily eroding. So what can system builders and solution providers expect, assuming these trends continue?

“The only potential vertical [for netbooks] is education, but mostly in Eastern Europe, Latin America, and Southeast Asia,” says Bob O’Donnell, program vice president of clients and displays for analyst firm IDC. “We just haven’t seen much interest in the United States. A lot of schools here are focused on other devices – iPad, for example.”

The upshot for U.S. channel pros is tepid demand. “The realistic netbook opportunity [for VARs] is little to none,” O’Donnell says.

“I initially wrote netbooks off as a nonentity,” he continues. “I was proven wrong, and then ultimately proven right. The only appeal turned out to be the really low cost. The performance just wasn’t there. In general, the whole netbook category suffered a black eye due to performance.”

The Tablet’s Advance

Netbooks are $299, and an iPad is $399,” he says. For that extra $100 buyers get a thinner, faster device with a wider range of uses Bob O’Donnell

As O’Donnell sees it, netbooks fell to an ever-shrinking laptop form factor and the blossoming of the tablet market. “Netbooks are $299, and an iPad is $399,” he says. For that extra $100 buyers get a thinner, faster device with a wider range of uses. “It makes it almost impossible for netbooks,” O’Donnell notes.

Indeed, sales of tablets are rising dramatically. A full 34 percent of U.S. adults will own a tablet by 2016, according to Forrester Research Inc. Meanwhile, a January 2012 study from the nonprofit Pew Research Center found that the number of U.S. adults who own a tablet or e-reader nearly doubled from 10 percent to 19 percent during the 2011 holiday shopping season alone.

Leading the tablet sales charge is, of course, Apple with its popular iPad products. Apple says it sold more than 35 million iPads worldwide in 2011 and is on pace to meet or exceed that number in 2012. Tablets based on Google’s Android operating system, while lagging well behind the iPad in popularity, will account for 38.4 percent of global market share in 2012 just the same, according to research firm IHS.

Intel’s Ultrabook Push
All of those tablet sales have laptop makers feeling the pinch, with netbook sales being hardest hit. “Even though Intel continues to improve the Atom CPU,” O’Donnell says, “the damage has already been done to the netbook category.”

The hardware industry’s response, logically enough, has been to abandon the netbook for full-function, small-form laptops, similar to Apple’s MacBook Air.

Intel’s ultrabook concept, for example, is meant to help PC manufacturers compete with mobile, quick-start laptops and tablets. The specs call for the inclusion of Intel’s Rapid Start Technology for quick boot times, Smart Response Technology for fast access to oft-used files, and Smart Connect Technology for application updates around the clock, even when the computer is asleep.

Among popular ultrabooks currently available are the Acer Aspire S3, ASUS Zenbook UX 21, Dell XPS 13, HP Envy Spectre, Lenovo IdeaPad U300, Samsung Series 5, and the Toshiba Portégé Z830 Series. Price points for such devices average between $800 and $1,000, versus $999 and up for the MacBook Air.

Though netbooks cost far less, their future remains bleak even so. Selling low-cost, Web-enabled mobile PCs to budget-conscious computer buyers won’t be impossible, according to O’Donnell, but it won’t be easy either. “It’s getting harder and harder,” he says.

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