Netbooks' banner year offers wireless opportunities

Netbooks were one of the biggest – albeit smallest – consumer electronic sellers in 2008 and that momentum is expected to make them the leader in the PC market and drive smartphone sales in the process. Wireless operators view these ultraportable laptop computers as a way to drive interest in wireless Internet access and realize new data-driven revenue streams. According to a recent conference hosted by analyst firm Bernstein Research, as well as several reports on the market, netbooks are at the beginnings of a steady rise to the top.

More than 10 million netbooks totaling around 16% of the overall consumer netbook PC sales were sold in 2008, according to Bernstein, which believes the market will become a major segment of the global PC market, selling 35.5 million in 2012.

“Their evolution has been somewhat spectacular,” said senior analyst Tony Sacconaghi at the conference. “Basically they're a year old and as of last quarter, they were 22% of all consumer notebooks and nearly 6% of all PC units sold. They are on a very steep trajectory and will clearly have an impact on the market going forward.”

Today, netbooks make up 90% of the ultra mobile devices (UMD) market, which also includes mobile Internet devices (MIDs) and ultra-mobile PCs (UMPCs), according to ABI Research. The netbook market was carved out in late 2007 by Taiwan-based PC maker Asus, which today sells 20 different models. Its first device was the Asus Eee PC, sold for $299 with a 7-inch screen and a Linux operating system. Netbook models today are characterized by a 7-to-10 inch screen and lower power, lower weight and a lower price point than their PC counterparts, according to Sacconaghi.

“Netbooks will evolve into something much thinner, lighter, and cheaper and have much better battery life,” added ABI Research analyst Phil Solis in an interview on MIDs. Solis said that out of this middle group between smartphones and PCs, netbooks most closely resemble the PC, although they are not as powerful. They are pushing aside the MID category, championed by Intel, in popularity and manufacturer focus as ODMs find it hard to make small, sleek enough form factors to fit MID requirements, he said.

“You are going to see a lot of early models [MIDs] come out this year, but it won’t pick up until next year,” Solis said. “It will be pushed out not just because of the economy, but because of the popularity of netbooks. Really they are different devices. You can’t put a netbook in your pocket, but you can with the MID. It has a bigger screen and keyboard. One is easier to type on. The other is more portable. They are different, but still a lot of the interest has been around netbooks.”