There’s no question that cheap, low power computers (and computer chips) are selling like hotcakes. And while the profit margins on these devices are certainly lower than the margins on high end gaming rigs, computer makers have to be happy that anything is selling well during the recession. Well, maybe not happy exactly.

Graphics chip maker NVIDIA doesn’t really do low end. And the company’s CEO says the low end is growing. He doesn’t expect Intel Atom powered computers to take market share away from expensive computers with quad core processors. But he does suspect that cheap, low power laptopscould eat into sales of  mid-range computers, (the kind that might have a dual core processor and decent graphics card and sell for around $800 dollars).

All of this isn’t necessarily a bad thing for consumers. For years, we’ve been encouraged to buy the latest and greatest technology, and that’s always meant more power and a higher price tag. But if you want to use a computer for surfing the web, watching videos, and editing office documents, you might not need a quad core processor. Of course, companies like NVIDIA and Intel make most of their money on higher end chips, and if sales of those devices slump it could hurt the companies that are pumping out the components that make low cost computers possible. Maybe we’ll more ARM-powered netbooks in the future?

Anyway, NVIDIA is trying to carve a niche for itself in the low power computing space. The company’s ION platform is designed to bring vastly improved graphics performance to the Intel Atom processor. No netbook makers have announced plans to use the ION platform in a device yet, but if the price is right, I could see this being one way that companies can justify charging a few extra bucks for their mini-laptops.

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4 replies on “NVIDIA: Cheap laptops will cannibalize mid-priced laptop sales”

  1. Cheap, low power laptops could eat into sales of mid-range computers if the prices are affordable. For general users like us, we use computers to surf Net and other simple tasks, therefore coping with the latest technology is not really necessary. Hope to see more cheap laptops in the market. 🙂

  2. I see this as the laptop market self correcting.

    Hardware capability has far outpaced the demands of software for several years now (a decade ago this was NOT the case). My father uses my old computer from 8 years ago (pentium 4) with no performance issues. The most widely used applications (office, the internet, voip, photoshop, etc) work just fine on old equipment. The most obvious step then was to make it more affordable, not faster. Also, portability tends to trump screen real estate for many many consumers. Hence, the popularity of the atom.

    Nvidia knows that it is losing its niche, far fewer big games are being released for the PC. Even most people who use photo/video manipulation software don’t need a graphics card. The ION platform will rapidly become obsolete, seeing as how there is no real need for it in the first place. Because of resolution limitations, 720p can’t be fully appreciated on most screens anyway (600px from top to bottom, not 720). Still, I wouldn’t expect them to bow out gracefully.

  3. I wonder if nVidia is working in the background with one of the ARM vendors…just in case.

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