News Blog

The proliferation at Computex of ultra-small, inexpensive netbooks poses this pesky question: why are traditional ultra-compact laptops so expensive?

The Asus Eee PC 1000 debuted this week with a 10-inch screen, 40GB solid state drive, and Windows XP. Pricing has been rumored at between $600 and $700.

Features and size threaten to push the Eee PC 1000 netbook into a category traditionally referred to as subnotebooks--with one glaring difference: price.

Subnotebooks like the 11-inch Lenovo IdeaPad or Sony Vaio TZ series typically start at above $1,500 and go up from there, ranging up to $3,000.

HP mini-note and traditional ultra-portable notebooks: both ultra-compact designs, but big price gap

(Credit: HP)

But as netbooks inevitably add more features, analysts and industry insiders are beginning to wonder what will happen to the traditional laptop category. "(If) you add more (gigabytes) of storage and a bigger screen, I don't know what makes this any different than a normal laptop," said Avi Cohen, a managing partner at Avian Securities.

Cohen said the obvious downside is a slower Atom processor--compared with a mainstream Core 2 chip--but on the upside Atom has better battery life. "Arguably there's a category of consumers that don't need such high processing power. Or, at least, a different kind of processing power," Cohen said.

Maybe many more than computer makers realize. Industry sources familiar with Intel's netbook strategy also see a potential clash of categories eventually. "Of course, it's always been a concern, as (netbooks) gets more and more traction," said one source familiar with Intel's thinking on this topic.

And as netbooks add more features and creep up in price, Intel has to worry about the market confusion that may ensue. "Is a $700 laptop, even running Atom, a netbook?"--the source asked. That may be the question that laptop vendors and Intel will have to grapple with as the netbook category grows.

(An Intel company blog back in March described the netbook as a small laptop "designed for wireless communication and access to the Internet. And they cost about $250, making Netbooks a potentially disruptive and high volume market segment.")

Of course, subnotebooks like the HP 2510p, Lenovo IdeaPad, and Sony Vaio TZ offer more features than today's netbooks: faster processors, more memory, bigger hard disk drives, and usually larger screens than a netbook like the HP Mini-Note.

But two forces may be working against this purported advantage: One, all of these features may be overkill for a lot of consumers who use traditional, pricey subnotebooks for only email and simple Web browsing. And, two, netbook makers may continue to expand their offerings to push them closer to subnotebooks while keeping the price low.

This is something that Glenn Henry, CEO of Centaur, the Via Technologies subsidiary that designed the Isaiah processor, has said. "The one gigahertz (Isaiah) is plenty powerful enough to do lots of things," Henry said. Via is also targeting the low-cost netbook category--and has been for some time. Its C7 processor is currently used in the HP Mini-Note 2133.

"If this category continues like it is, at the end of the year you may have mega hard drive-based netbooks," said the source familiar with Intel's strategy. "Let's say someone comes out with a really nifty (design), it's got some extra features, a bigger screen, and a few extra bells and whistles. I don't think that's a netbook even if it's running an Atom processor."

What is it then? That's the $64,000 question.

Asus new Eee Box super small form factor desktop.

(Credit: Asus)

Word got out a little early this morning regarding Asus's small Eee Box, so we can share what we saw in a preview in our offices a few weeks back. The small, Wii-looking PC will hit the U.S. via online retailers (and perhaps a few specialty brick-and-mortar shops) later this year.

The listed dimensions of the unit are 8.5-inches high, 1-inch wide, and 7-inches deep, standing upright on its included stand. It can also lie down flat.

Official specs are as follows:

• Operating system: Linux System/ Hardware Compatible with Windows XP
• CPU: Intel Atom N270 (1.6 GHz, FSB 533)
• Memory: 1 GB / 2 GB DDR2
• Hard drive: 80GB / 160GB 5,400 rpm
• Chipset: Intel 945GSE + ICH7M
• Integrated graphics chip: Intel GMA 950
• Networking: 10/100/1000 Mbps LAN, 802.11n WLAN, Bluetooth optional
• Media card reader supporting: SD, SDHC, Mini SD, (Micro SD through adapter) ; MMC, MMC plus, MMC4.x, RS MMC, RSMMC4.x (MMC mobile through adapter);MS,MS PRO

For its rear ports you get two USB 2.0, one Gigabit LAN, a DVI output, left and right audio line out with S/PDIF, and an input for a WiFi antenna. There is no optical drive, but the Eee Box does feature a user removable hard drive to simplify upgrades and repairs.

Asus is selling a variety of other Eee Box configurations around the world, but it will have three available in the U.S. One for $269 comes with 1GB of RAM, an 80GB hard drive, and an unspecified version of Linux. Another Linux-based model comes with 2GB of RAM and a 160GB hard drive for $299. Finally, a Windows XP-based version with 1GB or RAM and an 80GB hard drive will sell for $299.

When it comes out later this summer, the Eee Box will complement Asus' much-talked about Eee PC laptops, and it will compete directly with Shuttle's KPC K-4500 Linux desktop. While none of those systems are exactly mainstream, they're all known for low prices and a surprising amount of features for the dollar.

WiMax is in the cards for the Eee PC. Asus will demonstrate notebooks Monday that integrate WiMax chips from San Jose, Calif.-based GCT Semiconductor.

Asus Eee PC

(Credit: Asus)

Despite recent statements that the Eee PC 901 will not get WiMax, GCT Semiconductor announced--along with Asus--Sunday that Asus has integrated GCT's GDM7205 WiMAX single-chip silicon into the F8 notebook series and Eee PC.

GCT says the F8 series and Eee PC will be demonstrated with WiMax at the WiMax Expo Taipei that begins on June 2nd.

The widely-reported specifications for the Eee PC 901 are a 1.6GHz Atom processor, an 8.9-inch screen, solid state drive (12GB or 20GB), 1GB of memory, and either Linux or Windows XP. A future version of the Eee PC is expected to get WiMax.

Intel will also be demonstrating WiMax in the Asus M51VA notebook at Computex. Versions of the Eee PC may also come with the Intel WiMax chipset.

But Asus is clearly working with GCT also. "We are pleased to be working with a proven industry leader like GCT, who has enabled Asus to provide our customers with systems containing reliable high performance WiMax capability," said Jellent Sun, Asus' senior director of notebook product marketing, in a statement.

GCT said that its single-chip WiMax solution enables "lower power consumption for longer battery life, smaller form-factor design and lower bill of materials cost."

GCT is also supplying WiMax chips for notebooks based on Via Technologies silicon.

As a Computex preview, Intel is showing off its "delayed" Centrino 2 platform via an Asus notebook.

Asus M51VA with a 2.4GHz P8600 processor

(Credit: Intel)

A chunk of the Centrino 2 roll-out has been delayed until August 5--and WiMax even beyond that. Intel, however, is slated to do a Centrino 2 processor refresh on July 14.

"Today I've got my privileged hands on a brand spanking new Asus Centrino 2 ("Montevina" for us nerds) system," according to a pre-Computex Intel blog.

Intel, not surprisingly, is trying to build enthusiasm for Centrino 2 and WiMax. But, with chipset and WiMax delays, all this euphoria comes with qualifiers.

The Intel blogger, Craig Raymond, senior technical marketing engineer for Corporate Demonstrations at Intel, is--not surprisingly--ebullient about the "new mobile powerhouse"--An Asus M51VA with a Penryn P8600 2.4GHz processor. The P8600 is part of the upcoming Centrino 2 processor refresh.

But he quickly qualifies the euphoria with: "Oh Montevina...You broke our hearts with the launch delay."

He cites one of the best features as testing "World of Warcraft over the live Fitel WiMax here in Taipei."

"That's right. You heard me correctly. Montevina, WiMax; live in Taipei. Kind of strange to say it all in one mouthful, but it's finally here."

This statement has to be qualified too since WiMax won't ship with Centrino 2 until later this year. "When WiMax ships with Centrino 2 later this year, no add on card required, the Echo Peak mini-card hidden under the hood (like the one inside this Asus) promises the 'always on' connection we've been lusting for."

"Online gaming over a live carrier network has long been my holy grail around WiMax. Here from my outside park bench, after downloading my Warcraft client, I'm able log into the game world to slay all manner of goblins and over sized gerbils," he gushed. (More here).

Forget Intel and AMD for a minute. The two largest PC circuit board makers, Asus and Gigabyte, are at it.

The Asus motherboard at the center of the feud

(Credit: Asus)

PC motherboard maker spats have typically taken place below the radar. But a recent round of particularly sharp recriminations have become very visible because they go to the core of a new trend in marketing: How green is your motherboard?

This is what happened: Gigabyte, according to reports, said in Taipei earlier this month that Asus' EPU (energy processing unit)-based motherboards do not achieve the power savings that Asus claims.

In short, Asus claims power savings of just over 80 percent, while Gigabyte claims it is closer to 59 percent.

Gigabyte's attack on Asus alleged that the EPU is purely a marketing term and that Asus did not change the design, firmware, or packaging of the motherboards. Asus returned fire saying its claims were legitimate and threatened legal action, concluding its statement with: "Asus reserves the right to take legal action against any individual, organization or corporation which creates or spreads such rumors."

Seemingly pretty tame stuff by Intel-AMD warfare standards but an issue that has serious implications in the green computing age. Motherboard energy efficiency "is a huge marketing issue as of now," said Wolfgang Gruener of TG Daily that reported on the issue along with Tom's Hardware.

But it does cry out for perspective, according to Dean McCarron, principal at market researcher Mercury Research. Some of the interest in this issue emanates from Web sites that cater to enthusiasts that build their own systems. "The build-your-own crowd...that's a tiny, tiny part of the market...on the order of 1 to 2 percent of all motherboards," McCarron said.

"When you ask how important it is, you have to ask--how important is it to OEMs (original equipment manufacturers) and systems integrators? There it's becoming of increasing importance," he said. "Dell or HP or Lenovo...You'll see them now offering low-power (models). None of those classifications existed five years ago. So, it's becoming an item of increasing importance over time."

This is true. Dell, for example, says on its business desktop page: "Thanks to Energy Smart technologies, the OptiPlex 755...can save you up to 78 percent on power."

The feud may also have some parallels with Intel-AMD wrangling. As Asus grows in size, McCarron sees other motherboard vendors picking on Asus, the way smaller processor suppliers target (rightly or wrongly) Intel. Asus had sales of $6.9 billion in 2007 and, in addition to motherboards, makes laptops, desktops, servers, graphics cards, mobile telephones, pocket PCs, and a host of computer accessories.

The current premium XBox 360 is black. Is blue next?

(Credit: Microsoft)

Following HD DVD's demise, there's been a lot speculation that Microsoft would add a Blu-ray option to the XBox 360. The latest rumor has a subsidiary of Asus, Pegatron Technology, making a premium Blu-ray-equipped version of the XBox 360 that will arrive in time for the holidays. This one follows on the heels of a report that Lite-On was going to be the one making the Blu-ray drives for Microsoft's game console.

If you speak Chinese, you can translate the Asus rumor from Economic Daily News, a publication that Gizmodo calls a "Taiwanese rag." While we may not have tremendous faith in the specifics of the rumor, Taiwanese companies aren't known to keep secrets all that well (that's a gross generalization based on a few comments I've heard from industry insiders, but I believe it). And it does seem logical that Microsoft will add a Blu-ray option to help eliminate any perceived advantage that Sony might have with the PS3.

All that said, don't expect Microsoft to put out any games on Blu-ray any time soon. With the current XBox 360 installed base having only a DVD drive to play with, Microsoft would be looking at movie playback, not gaming.

Of course, the rumors could be wrong and Microsoft could simply put out an external Blu-ray drive similar to its discontinued HD DVD drive offering. Or perhaps there will be a premium XBox 360 with Blu-ray, as well as a separate Blu-ray external drive for current owners. Sounds inevitable, right? Comments?

Source: Gizmodo via Kotaku via Economic Daily News.

More low-cost laptops are headed to a retailer near you.

Intel plans on expanding the distribution of its inexpensive, school children-friendly Classmate PC to U.S. and European retail outlets, according to a Reuters report on Wednesday.

Intel's Classmate PC

(Credit: Intel)

The Classmate will sell for $250 to $350, Lila Ibrahim, general manager of Intel's emerging market platform group, told Reuters. Apparently Intel has already been conducting pilot programs using the devices in classrooms in the U.S. and Australia.

Though the Classmate is already available on the retail markets of India, Mexico, and Indonesia, this will be the first time the device has been for sale to consumers in the developed world.

Intel designed the PC for use in schools in developing nations. Local manufacturers build them with customized software configurations for the needs of specific local markets.

The XO from the One Laptop Per Child initiative, which also builds low-cost notebooks for the same markets, has been available via retail in the U.S. for a while. OLPC had a promotion where consumers here paid $400, which bought one XO for them and one for a school kid in the developing world.

But they're not the only ones jumping into this fray. Asus launched its low-cost, stripped-down Linux-based Eee PC last fall specifically for the U.S., Japanese, and European retail markets, and caused quite the stir. It sold 350,000 units in the first quarter it was available here, and is making some of the biggest names in computing a wee bit nervous. It's giving pause to worldwide PC leader Hewlett-Packard, and second-largest notebook manufacturer Acer, both of whom are said to be readying their own low-cost, small form-factor laptops for sometime this year.

The Eee PC certainly is bringing cachet to the tiny, Linux-based laptop segment, but will that translate to the cheaper Classmate PC? The Classmate is a bit clunkier looking, and has a silly-looking (though great for kids) handle on the spine, whereas the Eee comes in a variety of colors and looks like a laptop an adult wouldn't mind being seen with at his or her local coffeehouse.

Asus' new GeForce 9800GX2 3D graphics card.

(Credit: CNET)

With this morning's announcement from Asus and its EN9800GX2 graphics card, we get the first glimpse of what Nvidia's GeForce 7950GX2 should have been. That card, if you'll recall from the summer of 2006, was the first SLI-on-a-single-card design from Nvidia. Effectively, it put two 3D chips on a single two-slot card. What that means is you didn't need a specialized, SLI-compatible motherboard to enjoy superfast game performance, because all of the necessary circuitry was built into the card.

The problem with the GeForce 7950 GX2 was that it was expensive, and it hit the market about five months before the first DirectX 10 cards came out. With the next-generation cards so close behind, it was hard to justify spending a lot of money of a old-generation card. Asus EN9800GX2 (and similar cards from other Nvidia board partners) fixes that generation gap. At $600 it's still expensive, but the pair of GeForce 9800 graphics chips built into it are fully DirectX 10 compatible.

Of course, DirectX 10 compatibility doesn't necessarily guarantee fast performance. Our review of this card is almost complete, look for it later today. For the most part it met our expectations, but without giving everything away, we'll just say that it looks as if Crysis will remain the benchmark for challenging PC graphics for a very long time.

LAS VEGAS--As a computer, the Eee PC from Asus is intended to be the opposite of intimidating--it's made for children after all. But its potential as a market force is apparently giving chills to its larger industry peers.

Here at Sony's annual Open House event, the senior vice president of Sony's IT product division said the tiny $299 notebook could potentially shift the entire notebook industry.

"If (the Eee PC from) Asus starts to do well, we are all in trouble. That's just a race to the bottom," said Mike Abary.

The Eee PC at its U.S. launch last fall.

(Credit: Erica Ogg/CNET News.com)

He means that if mainstream PC buyers start to find their needs met by a lightweight, simply featured, inexpensive portable, it's likely to impel all of the major players in the industry to pile on by lowering their prices. And that's in an industry with already low margins for retailers and manufacturers.

If the Eee PC just catches on with Linux developers, enthusiasts, and the tech-savvy early adopter crowd, that's fine by him. "But if mainstream buyers buy it, then, whoa," Abary said.

So should Sony, Hewlett-Packard, Dell, and their ilk be frightened of Asus? So far, the version of the Eee PC in the U.S. only comes with Linux, but that will soon change. Japan got its Windows XP version last month, and the U.S. should be getting one in the next few weeks. (See the full review of the Eee PC by CNET's Dan Ackerman.)

And even with just the open-source version available stateside, the numbers say it's striking a nerve: the company reported moving 350,000 units of the Eee in the first quarter it was available last fall.

Sony's not the only one taking notice. Acer is reportedly readying an Eee competitor, and the yet-to-be-officially-announced HP Compaq 2133 was developed with the Eee firmly in mind.

As for Sony, though it did start offering lower-priced notebooks last year in the $800 range, don't expect the company to go any lower just yet. Abary says so far the company is just "keeping an eye" on the Eee's activity.

Sony has always positioned itself as a premium brand, and will continue to do so, as was evident in the rest of its PC offerings on show here.

A Vaio to match your crocodile-print shoes.

(Credit: Erica Ogg/CNET News.com)

The company has been at the forefront of the uber-personalization trend that's taken over the notebook industry. By charging more, the company has more leeway with the options it can offer customers. It began doing colored laptops three years ago and is now branching out into personalized patterns, and--as suspected--textures.

People who buy their Vaio at the SonyStyle store online have as many as 36 different choices for personalizing their laptop. The Graphic Splash line has three different patterns and multiple color combinations, as well as a choice of font on the keyboard. "That's what consumers really, really want," Abary told a gathering of reporters earlier in the day.

Sony also said that Vaio as a brand sells particularly well with women, which could also explain Sony's increased emphasis on personalization. Though 80 percent of notebooks sold industrywide are owned by men, Abary estimated, Vaios' percentage ownership by men is in the low 70s, indicating a higher-than-average ownership rate by women.

But it's not all about appearances. Sony is also pushing its lineup of home theater PCs, which are not primary PCs, but still start at $1,699.

The TP series home theater PC is now a Blu-ray player too.

(Credit: Erica Ogg/CNET News.com)

Though Sony had earlier indicated that its TP home theater PC (that white round one), didn't sell particularly well last year, it still decided to bring it back for Round 2. It's still round, but now it's got some high-definition guts. Sony beefed it up with a Blu-ray Disc player, Intel Penryn processors, and two Cable Card tuners. It's also now available in black for $1,699 to $3,000.

Though it was released in the fall, the all-in-one PC from Sony, the LT, is part of the same strategy. Again, though it's a PC like Gateway's One or Dell's XPS One, Sony positions the product as a TV with PC capability instead of the other way around. Doing so is likely to lure more high-end customers, with the LT's Bravia-like bezel echoing Sony's line of LCD TVs.