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Preston Gralla's picture
Preston Gralla

Seeing Through Windows

Are the glory days of the netbook over?

Netbooks have been the one bright spot in PC sales over the last year. But there's some evidence that the glory days of the netbook are over, and that buyers will turn to more traditional notebooks.

The latest evidence for it comes from a survey by the the NPD Group, which found that only 58% of people who bought netbooks rather than notebooks were satisfied with their purchase.

Computerworld reports that

The disappointment with netbooks -- NPD analyst Stephen Baker preferred that term rather than "dissatisfaction" -- stemmed from expectations that a netbook was the same, more or less, as a laptop. Six out of every 10 netbook buyers, said Baker, thought that the two were equivalent, and figured that their new netbook would have the same functionality as a laptop.

The problem was particularly acute with a key demographic for netbook buyers, 18-to-24-year-olds. Computeworld notes:

Among 18-to-24-year-olds, an important demographic to netbook sellers, who tout low prices to the money-challenged college-aged crowd, 65% said they expected better performance than they got from their netbooks. Only about one in four, 27%, said their netbooks performed better than anticipated.

An unhappy netbook buyer isn't likely to buy a netbook again; most likely they'll upgrade to a notebook.

Netbook makers have already recognized that ultra-low cost notebooks with tiny screens and keyboards may be on the way out. Many have announced larger model sizes, which they expect to ultimately outsell netbooks.

The Computerworld article notes that a new generation of notebooks is coming out, priced between $500 and $1000, which "sport screens larger than netbooks, but cost considerably less than current ultra-portable notebooks.

They're called CULV, or "consumer ultra-low voltage" devices, and they'll likely be the Next Big Thing, as netbook sales wane.

What People Are Saying

Netbook = A Secondary Computer

My main computer is a powerful desktop, and a netbook might be appropriate for a portable, secondary, computer.

Neboooks aren't powerful enough to be a good main computer.

Hmmmmm...

I'm in my 50s and I'm on my SECOND netbook. I love my Asus 1000HE -- it does everything I want it to do and does it snappily! We "Boomers" represent the biggest market for everything, including netbooks.

glory days of the netbook over?

I don't believe this article, or the research behind it. The prime demographic for netbooks was never 18-24 year olds, but much older. People I know who are most interested in netbooks, are looking for a super-cheap alternative to a desktop, and never could justify the cost of a laptop to do things like check email and surf the web from their couch. When I whip out one of my two netbooks (both 9" inch screen, Atom, 1GB RAM, 8GB SSD), I always get a lot of questions from 30, 40, and 50somethings, but almost never from 20somethings, and the teenagers are too busy with their cell phones and ipods to notice me.

Second, I know I am a super-cynic, but who do you think paid for surveys that say netbook buyers are dissatisfied? Who stands to lose the most as sales of ultra-low profit margin netbooks displace higher profit margin laptops? Makers of laptops, and Microsoft, that's who.

Third, younger buyers are hugely fickle. Even if they loved their netbook when they first got it, they move to the newest coolest thing as soon as it's available. Measuring the acceptance of a product in the overall population, based upon that age group alone, does not represent the market potential of any product. They have already been through four or five 3g phones by now. If you asked them how satisfied they were with their first one, what do you think their response would be? I doubt they would give it high marks.

How does NPD group get its money?

Not dead yet

Netbook is still alive for mainstay desktop users who still want some sense of portability with low cost. Answer: Netbook.

there will be faster chips, less weight, etc.

The next generation or two of netbooks will sport faster processors, etc.

This objection--they're too slow for youth--will then fade for most, age independent.

What will then reign are portability and battery life. Much less expensive, less power consumptive solid state drives will contribute to both.

What would be revolutionary: holographic or similar screens that project the display into thin air. No heavy physical screen needed.

Coupled with a full-size fold out keyboard, you'd have it nearly all.

You can sort of visualize it: an fold-out outrigger type design (for stability), a somewhat larger than phone size footprint when folded, the battery dominating the weight.

In other words, it will be an advanced combo smart phone/real computer.

Nope

The Linux segment of the netbook market is dead but XP will continue to grow like crazy. The typical consumer doesn't like Linux, XP is a must. XP needs at least a 1GB of RAM to run well (2GB is better). Right now you can get a 10 inch, 1GB RAM, 160GB hard drive (or 12GB solid state drive), netbook with XP O/S for around $300. That's the sweet spot and the netbook mfg's have just figured that out.

Linux alive on MY netbook

I intentionally bought my Asus Eee 1000 netbook with Linux, upgraded to 2gb RAM, and then replaced the preinstalled version with Kubuntu (I tried a couple of other distros, but liked Kubuntu the best. Things installed include KDevelope, g++, Wine, and DOSBox. I often do light software development on it. My 2 year old dual core, 2gHz, 2gb RAM notebook usually collects dust. My quad core, 2.5gHz, 8gb RAM desktop gets used when I am at home although sometimes I use the Eee instead. My Eee is usually with me when I am away from home if I intend to use a computer. Today, I ran the battery down because I used it for about 4 hours. I love it, particularly while riding on the bus.

Yep!

@ Mickey
You need to check your fact, buddy.

The netbooks are only selling with XP because Microsoft dumpted the price of XP when they saw the run-away success of the netbooks shipping with Linux. MS reputedly discounted the price to the OEMs as low as $15. You mention yourself that you can buy a netbook with XP for around $300. How would that be possible if the seller had to pay MS the "normal" price for XP?

Linux will be the savior of the netbook class of portable computers. Why? Because you can run one of those relatively low powered computers with a FULL size Linux operating system. I own an HP 2133 Mini-Note netbook, one of the lowest powered netbooks on the market with a modest Via processor, 2 GB RAM (had to upgrade from 1 GB because it came installed with Vista, I couldn't buy it without, in the faint hope it would speek up Vista, but no such luck, to all intents and purposes totally useless). I wiped Vista off the HD and installed Ubuntu (full version, not the Netbook Remix), OpenOffice latest version 3.1, Firefox latest version and a host of other software. Everything works well and fast!

@ Preston Gralla
You quote:

"Among 18-to-24-year-olds, an important demographic to netbook sellers, who tout low prices to the money-challenged college-aged crowd, 65% said they expected better performance than they got from their netbooks."

Perhaps those doing the research should have been more thorough and asked these college-age people what they wanted to use their netbook for which made them unsatisfied. I think you would find that if they want to play Doom or similar graphics-intensive games, then the netbooks are not suitable, however, if they were using their ultra-portable and convenient netbooks for their college work, i.e. using a wordprocessor for writing their assignments, accessing the Internet for assignment submission and emailing, as well as research, the sort of activities you would expect college students to primarily use their netbooks for, then they would not have been dissatisfied.

Most college students that

Most college students that plays high graphic-games knows that netbook wouldn't be able to handle it! So games isn't the issue here.

Uhh... Really?

"The Linux segment of the netbook market is dead but XP will continue to grow like crazy."

How will the XP market grow like crazy when Microsoft kills XP in favor of Win7? And if they didn't like the performance of XP on a netbook, the sure as heck aren't going to like the performance of Win7. Win7 maybe faster than Vista, but it's nowhere near XP.

And the typical consumer hasn't had a chance to try Linux, so don't tell us they don't like it. Next I'm sure you'll say something about the return rates of Linux netbooks, so I'll go ahead and cut that off and tell you to check your facts. ONE company had higher Linux return rates, because they used a crappy implementation of Linux. Asus, Dell, etc, report similar return rates between XP and Linux.

Finally, Linux is about to go where Windows cannot -- the ARM processor, and a $100-$200 price tag. The Linux segment is far from dead -- it's just getting started. But that's technically a "smartbook"... so the glory days of the netbook is, in fact, over.