The idea that netbooks represented a brand new category of computing device was always a bit shaky. And I’m not entirely certain that anyone aside from marketers ever believed it. The truth is that a netbook is just a small, cheap, and light weight laptop. That’s it. If you look at all the so-called netbooks released over the last 2-3 years, that’s about all they have in common.

As a side effect, most netbooks have had low power processors, small touchpads, and a slew of other characteristics. And generally in order for people to slap the netbook name on a cheap ultraportable, it has to have a 10 inch or smaller display, although some folks insist that 11 and 12 inch notebooks can also be netbooks if they have a netbook-like processor.

Where am I going with this? Here: As we start to see a growing number of computers that weigh 4 pounds or less and cost $600 or less, it’s hardly surprising that consumers might start picking these devices up as alternatives to 10 inch netbooks with low power Intel Atom processors. Another device might better suit your needs, whether it’s an iPad or a thin and light computer like Asus UL20A. A few years ago you couldn’t find a $500 computer that weighed less than 3.5 pounds. Now you can get a tablet, thin and light, or a netbook.

So I get a bit annoyed when I see stories like the one Business Week is running that claim “Netbook sales sag as the iPad arrives.” There are two problems with that headline. First, although it’s likely that some folks might pick up an iPad instead of a netbook, it’s not really clear that there’s a causal relationship at play — that the launch of the iPad made enough people decide not to buy netbooks to make a dent.

But there’s a much bigger problem here: Netbook sales haven’t sagged. In fact, the article sites statistics from IDC tht show netbook sales in the first quarter of 2010 were up 33.6% from a year earlier.

So what’s with the claim that sales are slumping? Well, it’s because netbook sales aren’t growing as quickly as they had been. In the first quarter of 2009, netbook sales were up 872% from the same period in 2008.

Wow. That makes it sound like things are slowing down considerably, right? Ummm… not really. Not when you consider the fact that there was only one PC maker selling a netbook in the first quarter of 2008. Asus introduced the Eee PC 701 in late 2007 and until the middle of 2008 it was the only netbook model you could buy aside from the OLPC XO Laptop which wasn’t generally available to consumers.

The HP 2133 Mini-Note hit the streets in April, 2008 and other PC makers piled on after that. By early 2009 almost every major computer manufacturer had a netbook on the market. So basically IDC and Business Week are pointing out that netbook sales were dramatically higher at a point when you actually had a choice of models than when you didn’t. Shocking. And a year later, when the market hasn’t changed all that much, sales are still rising by more than 33%. Seems a bit early to declare that sales are off, doesn’t it?

As I said at the outset – I’m not saying netbooks as we know them are necessarily here to stay. It could be that low cost and light weight tablets and larger computers will largely take their place over the next few years. Or maybe smartbooks like the Lenovo Skylight and Compaq Airlife 100, which combine the elements of a smartphone and a netbook will wipe them out.  I’m just saying that as of today, the rumors of netbook’s death have been greatly exaggerated.

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18 replies on “Netbooks may or may not be dying… but that doesn’t excuse misleading stats”

  1. I will merge my comment from a previous blog post here recently. This is more current and seems relevant so I will post now.

    The sweet spot for a netbook is 11.6 inches. If people (I won’t mention any names) insist on call Atom based computers that are 11 or even 12 inches something other than netbooks, then I concede a bleaker future for netbooks. If the bloggers out there insist on limiting a netbook to 10″, even though an 11.6 or 12.1 inch Atom processor computer is the same thing, except in a bigger package then you are falling on your own sword.

    The reason for 11 and 12 inches being idea, is simply because of keyboard and touch pad size. So, if you have an 11.6″ Atom processor computer, and you have a CULV 11.6″ computer, then these are laptops suddenly? In that case, the Dells and HPs will kick up a fuss because they don’t want to be considered underpowered! Get my point? Sometimes I feel people really miss the obvious (speaking of people running blogs etc related to the netbook market only).

    The real question is, will the first time netbook buyers continue to buy netbooks. Are they satisfied? IMO, the next gen netbooks need ION or graphic abilities to play games. Ultimately people don’t give a rats a$$ about decoding video or running 10 different applications at the same time. CULV is higher price and you are getting more than what you need. Sure you can always step up in price but isn’t that what a primary computer is all about? People buy netbooks because of a secondary computer need.

    The iPad isn’t replacing anything. People who buy netbooks need keyboard because guess what? People type. People use Facebook. People IM. All require? Yes, a keyboard.

    As for smartbooks? Whatever. I certainly wouldn’t invest my time in anything related to future stock value in that segment. Add on to that the fact they don’t even own the trademark fully makes it even more sketchy.

    The point of the CULV moving down in size is to entice the netbook buyers into buying something with features they really don’t need. So, the point of CULV is so Dells and HPs can make more money. The issue then becomes, if you can’t see this for yourself, that the CULV will NOT BE PRICED CHEAP. It can’t be. It’s self defeating for them. They are coming out with 11 and 12 inch CULV because they want to make money. They can only charge more if they are giving you power and features that are suited more for a primary computer. Which again IS NOT WHAT PEOPLE ARE BUYING AN ULTRAPORTABLE COMPUTER (NETBOOK) FOR IN THE FIRST PLACE.

  2. One way to pose the question, very abstractly, would be: “Will/could iPads sell more netbooks?

    Why would that even make sense? Well, look at what Apple says itself. You NEED a computer to use the iPad.

    REQUIREMENTS:
    – Mac computer with USB 2.0 port
    – Mac OS X v10.5.8 or later
    – iTunes 9.1 or later (free download from http://www.itunes.com/download)
    – iTunes Store account
    – Internet access
    or
    – PC with USB 2.0 port
    – Windows 7; Windows Vista; or Windows XP Home or Professional with Service Pack 3 or later
    – iTunes 9.1 or later (free download from http://www.itunes.com/download)
    – iTunes Store account
    – Internet access

    That’s right, you need a computer to register an iPad and do many house keeping features especially since it doesn’t have its own USB port or robust OS.

    But what if you don’t have a computer?

    Don’t laugh, last summer I had two people come to my library to activate their iPhones because they DIDN’T have a computer at home. (It says you need a computer on the box, but people don’t read 8 pt font on the side of a box.) So, what is the cheapest solution for someone like that with no computer? BUY A NETBOOK!

    Buy a ‘Hackintosh’ and install Mac OS or buy a Windows PC netbook (sorry Linux users). Then use that as merely your ‘home base’ for the iPad that you carry around. A simple, elegant and inexpensive solution is to buy a netbook as well, if you ask me.

  3. Huge investments are being made by many large Companies on Pads that are going to be a BIG FLOP and they are already aware of the problem. Real people using Netbooks have zero reason for a Pad. This is why you see this propaganda, “Netbook sales sag as the iPad arrives.”. I feel sorry for the many manufactures that are going to lose money on this bad bet. People are waking up to Cloud devices and the evil zero privacy it presents.

  4. As many might think that I am owner of the Netbook sites so I would be inclined towards the Netbook market for the future of my own site :p Well that is note true.

    To be honest I believe that Netbooks are here to stay and to stay for a long time. It would be here to stay mainly for their cheap pricing. Many just incline towards the cheaper priciing even if the speed is not aqll that. As Brad already mentioned that if we have cheaper CULV note-books then netbooks might fade away.

    But my prediction is if CULV pcs are all sold at the4 $400 mark then netbooks will go even cheaper. Its all an “if and else” statements that I can think off..

    As far as tablet goes, we can just say that Tablets are Notebooks without a keyboard and have touch screens. If we bring that into the analogy we can say that Netbooks are small notebooks, so it does not make much difference. We can always compare one device to another as the main system is a constant, by that I mean all the devices can be refered to as a computer.

    I have feel that Netbooks will actually stay and it will be the cheaper computers for everyday use and smartbooks will be a compititor for smartphones and not nebooks.

  5. I think netbooks will live a very long life. Infact, the notebook will diminish a lot as the desktop PC makes a comeback with raw cpu power. For portability, people will move towards either the 10.1 inch netbook or the 11.6 CULV “netbooks”. Most people nowadays just carry a netbook and use their primary desktop PC at home for heavy duty stuff.

    On the other hand, once smartbooks come out, it would eat a huge marketshare from netbooks.

    Why?

    Everybody is concerned with familiarity and ease of use and not really the OS as indicated by Brad many times before.

    People just want a good web browser and at the most, a good word processor. A smartbook can do this.

    Just like Android on smartphones have taken the world by storm, it can be seen, people are not that stupid wanting a familiar windows interface. What people fear is some OS without proper GUI. If you have a good GUI and proper icons on the besktop screen to allow you to just click an icon, people will be comfortable with this.

    Just see Android phones, it does that. It is not Windows based but it has a good GUI. So long as people see the icons like Explorer, Firefox, Word Processor etc, they will be fine.

    A very important fact people overlook is weight. Notebooks and netbooks are all about portability. The ease to carry. Smartbooks are about 700g in weight. That is half the weight of the current average netbook out there. I refer to the Lenovo Smartbook with a proper keyboard.

    Do you think people will bother with a heavy 1.4KG netbook when they can get something half the weight and same battery life?

    Just see in the airports nowadays. The business traveller and ceo don’t carry their 2.5KG notebook anymore. You can be a top ceo also, you now carry a netbook. See the transition here. They have given up their powerful notebooks for a mere netbook.

    All because of weight and shoulder burden. This also shows that business travellers (and also general lay consumers) just want something to merely surf the net, mainly to check emails, stock prices, facebook etc.

    So, its a matter of time before another transition occurs.

    People want to reduce the weight burden to half ie to 700 grammes. And this is where smartbooks with keyboards will take over the traditional netbook.

    As for tablets, MIDs and pads, that is a different niche segment altogether. Having no keyboard, it will not be a threat to the traditional netbook at all.
    It may die of eventually as people move to bigger screen smartphones like the Dell Mini 5.

    So in summary, smartbooks with keyboards will kill the netbook or co-exist side by side with each other and rule the portability world with both killing the traditional big notebook completely.

  6. Part of the problem is there really aren’t any netbooks in the stores anymore. A netbook was originally defined as a netcentric, small, light and CHEAP device. Remember the EeePC was supposed to debut at $200, but supply chain issues combined iwth a realization Asus was tapping a gusher lead them to jack the price up and still have a waiting list for months.

    Once netbooks were shipping with 10 inch screens, Windows, fairly large hard drives and the price had crept up to $350-$500 there really wasn’t a real difference anymore between a netbook and a low end laptop. The product lines seamlessly fade between the catagories.

    Put a $150 to $200 netcentric machine on store shelves and we can find out if netbooks will sell.

    1. I think this is a great point. Netbook prices don’t seem to have fallen at all in the past year. Even with Smartbooks coming out, I haven’t seen anything to suggest they will cheaper, unless than have tiny 7″ screens. Let’s have something with a 10″ screen, solid state drive, and a 10 hour battery at a price for $200 and yes, I think it will fly off the shelves.

      1. I disagree. You can get a very decent netbooks for under $300 (Dell Mini 10v, Asus 1000p, Acer 532h). The Asus and Acer at least have 10 hour batteries. And no, netbook prices haven’t fallen to $200, but I think that’s a little bit of a pipe dream. People are willing to pay more than that for a little computer, especially when they’re used to paying upwards of 1,000 for an ultraportable solution. Is there a potential $200 product (i.e. smartbook)? Yeah, absolutely. But that’s not to say that what we have no isn’t someting cool and unique (at least compared to like, 2005).

        Another thing is that netbooks are becoming a lot better. I had a Dell Mini 9 a couple of years ago, and that thing was very mediocre. 8gb ssd, cramped keyboard, 2-3 hours of real world battery life. For the same price you get a lot more only a year and a half later (160gb hard drive, 10 inch screen, good keyboard and touchpad, longer battery life).

        Last point – I’m not sure you have such a merge in product categories. They seem kind of discreeet. Like, for $400 you can get an economy (heavy) 15.4 inch laptop w/ more processing power, or for 3-400 you can get a portable netbook. They have different appeal and do different things.

  7. I see tablets as toys. There are very limited in what they can do. Most people who would buy a netbook won’t buy a tablet, I might be wrong but I don’t think so. Computer makers would LIKE to get away from netbooks to something more profitable. I think netbooks are here to stay even though they might not change a lot.

  8. Awesome rant – great points all around!

    I only have a slight quibble – I really think that netbooks are here to stay. I would hope that of all places, a netbook blog would recognize that. I think as much as PC makers want to push people away from netbooks because of reduced profit margins, it’s a sector that’s really resonated with consumers. People can get a lightweight (almost-)laptop for email checking and word processing for under $400. That just didn’t exist 5 years ago.

    The iPad will be nice for a lot of things (watching videos and easy integration with the app store and itunes), but it’s not a substitute for what a netbook can do. And you’ve said it a million times on this blog – you give someone a device that looks like a computer, people are going to expect it to run a full OS. So while smartbooks have a niche, they’re going to be very limited as long at that size and without a true OS.

    That still leaves a huge place in the market for netbooks. Look at the growth in the thin and light category with ULV PCs too. People want lightweight, cheap laptops – they’re willing to live without the latest core i3 processor if they can get it for under 500 bucks. I guess I’m just sayin – Netbooks are here to stay.

    1. I don’t disagree… I think thin, light, cheap computers are here to stay.
      I’m just not sure that they’ll be 10 inch models with Atom processors. If 12
      inch machines with CULV processors for $400 become much more popular, I can
      see netbooks fading — or at least becoming a small niche product much like
      the UMPCs and MIDs have been for the last few years.

      1. Yeah I agree – there’s nothing set in stone about an atom processor. The critical factor is the price point. People want to be able to have a portable computer for $300-500. They’re just not willing to pay $1000 for a business-oriented ultraportable. And they’re willing to sacrifice some things from a normal computer. If you are able to get a regular Intel processor at that price point, of course consumers will go for it. You already see this push with nVidia ION systems and Broadcom accelerator cards.

        And yeah, I think that slightly bigger screens (Asus UL20/Acer 1410) could become dominant, much in the way netbooks crawled up from 7 inches to the ubiquitous 10 inch models you see now. The big problem with 10 inch netbooks is the 600 horizontal lines on the display, which makes for a lot of scrolling .

      2. I think UMPCs and MIDs have remained a niche product primarily for two reasons: The high price point and the lack of a comfortable keyboard.

        On the other hand, that’s not an issue with the netbooks and that’s why my MSI U100 is my primary computer. Like many — in fact, I would say, most — people, my computing needs are simple: I use my netbook to send emails, surf the web, use MS Office, rip MP3s (I have an external optical drive that I dust off for this purpose) and watch the occasional video. The keyboard on the MSI U100 is awesome and I can type on it for hours on end without feeling any strain, and the display is excellent as well.

        I can see upgrading my MSI U100 one day, but I’m holding out for a netbook that has a similar form factor — 10″ display, good keyboard — but offers Pixel Qi and a longer battery life. (I get more than five hours with my six-cell battery but it’d be great to be able to go 20+ hours.)

        As for the iPad, it holds zero appeal for me even though I’m a gadget freak. I lost interest the minute I found out there was no support for Flash or SDHC. That lack makes the iPad less functional than my Eee PC 701!

        Don’t get me wrong: I don’t think tablets are totally useless. I just don’t see them replacing the netbooks, which have proper keyboards. In fact, I’ve actually ordered one of the Enso ZenPads, because I think that would be handy to have something so small to tuck into my purse, plus it’d make a good ebook reader. But the ZenPad would supplement, not replace, my netbook. (Except for travel, once the Android keyboards hit the market!)

        1. And until that day comes, you could always just opt for a larger purse. 😉

          Although I am sure a lady must observe the dictates of style and occasion –
          We both know that purses come in all sizes, some of them by all rights should have wheels and a harness to pull them. 😉

          1. True! Which is why I try to limit the size of my purse, so that it’s only slightly bigger than my netbook, otherwise I’d be carting the kitchen sink around 🙂

        2. @Claudia – have you recieved your ZenPad? I was one of the unlucky few who ordered one in mid March only to find myself still waiting.

          1. @Tim – Unfortunately not. Enso never responded to any of my emails requested an update, so I ended up filing a claim with PayPal right before the 45-day deadline passed. PayPal gives the vendor time to respond to the claim (I can’t remember how long that is, a week or 10 days) and during that time I sent Enso yet another email telling them I’d rather have the ZenPad than a refund but got no reply. I guess Enso never responded to PayPal either, because PayPal issued me a refund.

            Enso claims that they finally sent a review unit to Engadget, but Engadget says they still haven’t received anything as of May 25th. According to the tracking info Enso supplied, the package arrived on May 27th, so I would keep an eye on the Engadget site for an update.

            In the meantime, the SMiT-560 is being rebranded by another company. The eviGroup Wallet is supposedly launching soon for €199 (about $252). Having been burned by the whole Enso business, I’m holding off on ordering the eviGroup Wallet until I see some confirmed reports that it is in fact shipping!

            I’m still very interested in the SMiT-560, despite the upcoming launch of the HTC Evo 4G and Dell Streak. The latter have bells and whistles that I don’t need (such as a camera) and I don’t want to lock myself into an expensive data plan.

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