Netbook phenomenon caught Intel by surprise
SANTA CLARA, Calif.--The popularity of the Netbook caught Intel by surprise--more than once.
The initial demand for Netbooks caught Intel--and almost everyone--by surprise.
(Credit: Asus)Shipments of this category of inexpensive, ultra-light, handy laptops--almost all powered by Intel's Atom processor--are set to hit at least 20 million units this year, about twice the number shipped in 2008, according to IDC. But if an analyst had suggested these numbers to Intel in March of 2008, executives would have dismissed the forecast out of hand--or laughed.
This failure, by many in the industry, to grasp the significance of the Netbook, forced Intel into perpetual catch-up mode at the beginning. "I'm the one who had to explain to our factory--I'm really, really sorry I miscalled the demand," said Noury Al-Khaledy, general manager of Nettop and Netbook Computing at Intel in an interview last week. "And the next month, I didn't quite get it right either," he said.
"I think we under-called how easily people would comprehend how useful the device was," he added. For the record, Asus launched the phenomenon with the Eee PC in late 2007, followed in 2008 by Hewlett-Packard, Acer, and Dell, among others.
Al-Khaledy continued. "I think there was sort of this pent-up desire for an affordable, portable, Internet-access light editing sort of device and many of our customers--with our help--nailed it. They helped us so much."
One of the distinct advantages that Intel Atom-based Netbooks have over other similar devices--such as those based on ARM processors--is Windows. ARM-based devices today don't run Windows XP or Vista--and won't run Windows 7. Intel-based Netbooks can run all of these operating systems and versions of Windows 7 may run as well, or better, than XP on Netbooks.
"People bash (Microsoft) all the time. But then what do you really want to buy?" Al-Khaledy asked. "People really do want Windows...the XP attach rate was really, really good." Though Al-Khaledy praised Asus' initial Eee PC and its Linux operating system, some consumers were disappointed when they found out that it wasn't Windows.
"The Linux thing wasn't clear to people. If you think you're getting Windows and then you get home and it isn't (that's a problem)," he said.
And what impact will Windows 7 have on the Netbook market? Pricing will be critical. Unless Windows 7 is priced aggressively, Al-Khaledy doesn't see it as a catalyst necessarily for a spike in Netbook sales. "I don't see it as a big tipping point. It's all about pricing. If you have to pay $30 more for Windows 7, it might make (consumers) pause. There's just not a lot of margin in the box," he said. "(But) if Microsoft prices Starter and Basic aggressively, why wouldn't you?"
"I would expect most (PC makers) will launch a Netbook with Windows 7," Al-Khaledy continued. "The Starter, Basic (versions) should run well." He isn't sure about the premium version of Windows 7, however, and said he is still in discussions with Microsoft.
And what is the pricing sweet spot for Netbooks? "The bulk today is between $350 and $299 but I would love to see it get to $250. Wait 'til Q4," he said.
Al-Khaledy takes issue with Netbook makers that price their systems above $600. Though he would not mention any names, Sony has come out with an Atom-based Netbook (which Sony insists is a notebook), priced well over $1,000. "Generally speaking, there have been people (PC makers) that have charged really high prices for Nettops and Netbooks, and those products have not done well because over time people start to compare them...if you spend $650 for something, you expect the 650 experience," he said.
"Are there a huge swath of people that are going to pay that price for Netbook performance? I don't think so."
Brooke Crothers has been an editor at large at CNET News, an analyst at IDC Japan, and an editor at The Asian Wall Street Journal Weekly, among other endeavors, including co-manager of an after-school math-and-reading center. He writes for the CNET Blog Network and is not a current employee of CNET. Disclosure. 
That said, most of my friends are and what I noticed was most would buy the netbook and install linux on it in the first day. Most have said they got better performance and battery life using linux (specifically Ubuntu) on the netbook.
I lucked out this Christmas season I bought a new Acer laptop for the price of a netbook with more horse power, ram, and screen real estate. So no netbook for me when I can get a decent notebook for the same price.
Go talk to a average person on the street and ask what operating system they have on their computer a good majority will give you a blank stare.
I already made that decision a long time ago: I buy only OSX and Linux for my own use (the latter I usually donate funds to).
Next question?
Next silly remark?
PS yes I use Linux regularly.
PS: Intel doesn't have to care - it gets a sale with every x86-based netbook CPU sold.
Then the majority of your friends are techies. As the article states, most people that are buying these things want XP on them. My wife and a few others that I know purchased these to allow them to do work on the 2 hour commute from the Poconos, PA to Manhattan. The general public seems to want to do a lot of what they do on their desktops.. and that means WINDOWS.
I myself, would love to see a Mac based "netbook".
A netbook is for surfing, and answering email. And for that, people don't care what OS is on the system. And with XP Home, which was what my netbook came with, people can't do much, anyway.
Of course, techies immediately put Linux on it. I did. It connects fine with my office network, btw, which XP Home can not...
HARDCORE Gaming, video and audio editing: Windows without doubts.
Photo Editing, Computer auditing and forensics, ULTRA FAST file copying and recovering, "obtaining access" to audited networks: Linux.
Basic common sense.
double as TV or msg board in the kitchen. Since, x86 based platforms will offer ease of development if it was windoze/mac/linux based, users can add their gadgets/extensions etc themselves..
I doubt that so many people want to carry their netbooks on a daily basis and they really care about couple of inches of size and couple of pounds of weight.
I think people who buy netbooks care only about price and and this new definition "Netbook" makes it socially appropriate to buy a crappy computer - "It is not just a cheap and crappy notebook, it's netbook, it's just happened to be cheap (pure coincidence)"
It really is the third tier of internet access. My work and home PC are still where I connect most, but my blackberry and netbook are both pretty major sources of connectivity.
No need to be all snobby about something you don't understand.
I also like that I have windows installed on an SDHC and boot off that if I have to lend it to someone who can't use Linux, though you can do that with most laptops anyways.
First off, Netbooks are a new market. New users, new applications. The Intel guy says that people don't want Linux, 'cause Microsoft pumping money in PR so he can say this kind of things.
The bottom line. People don't care about Windows in this category. They want their programs to run, so they want Windows XP. They won't accept Vista Take 2 (aka Windows 7).
They hate that Microsoft still wants to pump Vista or Vista Take 2 down their throat (a worse analogy fits better). That's why they elected Netbooks. They are a Vista-less safe haven.
In the end, what Microsoft and Intel don't get is that people just want "Windows compatible" hardware. Just the same thing that happens when they buy a DVD, they want "DVD compatible" hardware. That's what killed "HD DVD" and upped "Blu Ray". "HD DVD" was just a remix of "DVD" but more expensive. Same goes with Vista and with Vista Take 2 (aka 7).
In the end Microsoft will learn that XP hit a sweat spot and that Netbooks landed on that sweet spot. Same spot landed by the CD, and same spot landed by the DVD. BluRay has a long way to go, as DVD-A and SACD had before. Vista can try a Take 3 and still miss this sweet spot. In the end, Microsoft will retreat and offer a "Windows Client compatible" version at 59 bucks OEM. At that moment we will see finally in peace with its user base.
Trust me.
Average users don't care..
If I
Also; "Incorrect Assumptions"
"[..... I suppose we all know what assumptions can do for us. IBM made some interesting assumptions about the original PC in 1981; or rather, Don Estridge and his very autonomous development team did.
I was in a meeting with Estridge and a number of other people in April of 1981, when I first was assigned to write the IBM education for the PC. It was stated at this meeting that IBM expected to sell about 275,000 Personal Computers - over a five year product life. in fact, IBM sold almost that many on August 11, the day before the official announcement. IBM held a preannouncement showing of the PC in Toronto at the annual ComputerLand Dealers of North America conference. ComputerLand dealers placed orders for nearly 250,000 computers that day. On August 12, IBM took orders for almost 250,000 more Personal Computers. IBM's planners have not been correct since....]"
http://www.os2bbs.com/OS2News/OS2History.html
According to this story - they all always appear to be "caught by surprise" - don't they"!
Its not all about cheapness the laptop must have some bit of power.
Arm laptops will choke on the most
- by Forked_Tongue May 10, 2009 9:43 PM PDT
- I think most of the negative comments missed the boat, the netbook is not the primary computer, it's a secondary or tertiary computer in the home. I agree with the assessment of netbook dominance if it wasn't for the fact all the low end computers use either Vista premium or basic instead of XP, if it did then netbooks would have been lucky to have had half the volume of sales it does. I think most people also fail to remember most people buy a computer as is and never ever modify it, they don't increase the ram, add hard drives, etc therefore when they get the 1 gb of ram, sata/ssd hard drive, little laptop some of them are actually impressed with the performance of it over their prior computer with the slower ide fragmented hard drive with a low mb buffer, less than 1 gb of ram, anti-virus expired, malware infected machines. I've had people come over and ask questions about mine (Asus EEE) at various places when I use it, of course I upped the ram to 2 gb, went to a faster ssd, and tweaked the registry so they're blown away majority of time because their computer "isn't THAT fast".
- Reply to this comment
-
(27 Comments)For many it's more convenient to lug it around casually, others it's better than tiny smartphones, some it's cheap enough to chance, and many who would take it into areas they wouldn't take their laptops too (safety, weather, etc). I have a regular laptop too that I only take to fix other people's computers or on extended vacation, I like the fact that I can put it in the glove box or under my seat, something I can't do with a regular laptop to prevent temptation and if it's stolen, it's still cheaper to replace than most laptops. When I retire it though it should make an excellent green server, just attach an usb storage drive bay to it, linux server ware on it (Ubuntu, CentOS, or many of the firewall ones as well), and now I can use keyboard and monitor on it (or remote control it) and best of all many netbooks can be ran as long as it's plugged to a charger and battery is removed, I have a few friends whose old laptops from various manufacturers that doesn't have this convenience. A very practical machine.