Netbooks, or low-cost laptops, could boost the penetration of personal computers (PCs — both desktops and laptops). Over the next three to five years, according to a Credit Suisse report, these cheap laptops and netbooks could add 170-250 million units globally to the current figure of around 300 million units. Netbooks sales, alone, could be 25 million units in 2009.
The report highlights the fact that the sale of handsets in countries like India shed light on the fact that volumes increase when infrastructure and device affordability improve. The new small-form factor, better affordability, better design, and most importantly improving data connectivity and changing consumer attitude towards connectedness and internet communities would mean that a truly mobile PC will become more of a personal device, it adds.
In India, low-cost PCs are finding takers. The numbers say it all. For the first quarter of 2009, the total netbook unit shipment touched 35,000 units, according to research firm IDC. Netbooks first entered the Indian market in the early parts of 2008. “For the first quarter of 2009, the total unit shipment of netbooks in India has been 35,000. Acer leads the pack with 13,000 units followed by Asus with 3,092 units. This is not all, vendors in this category are introducing better features. For instance, Acer plans to come with a netbook compliant with 3G among others,” explains Diptarup Chakraborti, Principal Research Analyst, IDC.
For the calendar year 2008, according to IDC, the total netbook shipments in India was approximately 37,000 units. Analysts feel that in markets like India these netbooks will give a tough competition to low-end laptops. “These netbooks have a tremendous potential in the market. There is a lingering fear that netbooks may cannibalise into the market share of low-end laptops and will start to eat into their market share,” adds Chakraborti.
In terms of growth, Credit Suisse notes that the cheapest segment — laptops below Rs 25,000 — were non-existent four years ago but accounted for eight per cent of total units last year. However, they expect this segment to be much higher, in the mobile PC space over the coming years.
This is significant for countries like India where PC penetration is as low as 3 per cent (India has currently around 35 million PCs and sells around 6-7 million units annually). Some of the reasons for this have been the price points, operating system availability, applications as well as the connectivity issue.
In India it is Asus, and HCL which launched their netbooks early in 2008 and so have managed to derive the first mover advantage in this new emerging segment, says IDC. With Intel introducing its Atom-based processor, it only adds to the growth.
“While the initial netbook models that hit the market were ‘stripped down’ versions of their notebook PC cousins, later models also feature hard disk drives (HDDs). In this 'avatar' netbooks have been able to open a niche market segment of casual computer users - primarily internet surfers and executives looking for a lighter, no-frills PC for use during travel and business meetings. Thus, what has emerged is that there is a niche for a portable computing device with less powerful processing capabilities than provided in full-feature PCs but at a more attractive price point. This segment would be interesting to watch in the months ahead,” explains Sumanta Mukherjee, Lead PC Analyst, IDC India.