PC builders pushing back against netbooks

Netbooks are about to face stiff resistance from many of the companies that touted them just last year, Avian Securities said in a research note on Tuesday. Analysts at the firm still expect netbook sales to rise, from 37 million in 2009 to 47 million this year, but that notebooks will leap from 140 million to 180 million in the same span. The fourfold larger growth would come from PC builders trying to drive customers to more expensive regular notebooks after frustration at the low profit margins of netbooks.

"PC [builders] have not given up on trying to find ways to recapture some of the margin lost," Avian analyst Dunham Winoto said.

A return would be at least partly voluntary due to improvements in notebooks themselves: as even budget notebooks get thinner and more portable, some customers are more likely to trade up to an entry level conventional design that may only carry a roughly $100 premium.

Predictions of a slowdown in netbooks for 2010 have been common but have mostly been tied to a saturated market rather than an active backlash against the product category. Avian's view is nonetheless supported by the industry as major vendors like Acer, Dell and HP have all shipped an increasing number of PCs using Intel's CULV platform or AMD's Turion Neo, either of which offers significantly more performance and higher profit margins but still keeps the final price low.

Only a few companies have actively resisted netbooks. Apple is widely considered the leader of the movement and has attacked netbooks at every turn, noting that they're frequently cramped, slow and cheaply built compared to what Apple deems acceptable.

By Electronista Staff

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AMD, Intel, computers, industry, Dell, HP, Acer, CULV, Turion Neo