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?"
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A little more than a year after the launch of the MacBook Air, a new luxury laptop has arrived from Dell. This calls for another look at the notebook versus Netbook argument, the computer equivalent of bourgeoisie versus proletariat. In this case, Air versus Aspire; Adamo versus Eee.
Lightweight luxury laptops have been around for a while (think Sony Vaio and Toshiba Portege ultraportables), but the age of head-turning, ultrathin designs dawned with the 13-inch light-and-wide MacBook Air, the HP Voodoo Envy 133, and the ThinkPad X300.
Dell Adamo luxury laptop joins the MacBook Air in the conspicuous consumption computing category
(Credit: Dell)Now the Dell Adamo joins the stable of conspicuously consumed luxury laptops. The Adamo soars along with Apple's Air in the rarefied pricing altitudes of $1,799 to $2,699.
At the other extreme are Asus and Acer, down-to-earth working-class designs which offer portability for a lot less. Though both companies offer expensive laptops too, they have gained prominence with their inexpensive Netbooks: the Eee PC and Aspire One, respectively. These typically fall into the sub-$500 range.
Dell's entry into the luxury laptop market was replete with all the trappings of a high-end product rollout, including a lavish, overdone Adamo Web site (as in, I couldn't click on "skip intro" fast enough) of beautiful people clutching computers. (And viewing the site, this question comes to mind: Is the Adamo meant more as a Dell showcase item--like a piece of finery set in a vitrine, to be admired but not purchased?)
Juxtapose this with what's happening in the Netbook space: inconspicuous but slow-but-steady creep into a higher-performance bracket. This trend is being driven by better Intel graphics (the GN40 is now capable of 720p HD video), with some Netbook designers entertaining the idea of adding even higher-performance Nvidia graphics. Reports also claim the Atom processor will be ratcheted up to 2.0GHz.
Will one design philosophy eventually prevail? Gravitating to a sweet-spot somewhere in the middle?
Let's do a little comparison shopping.
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