Netbook? MID? Is This PC Category for Real?

New generations of low-priced portable computers are on the way, but will they have much more than niche appeal?
netbooks
A portable computer priced way lower than the competition makes headlines with its small screen and bundled applications for instant productivity.

Sounds like a great marketing plan for the latest generation of Netbook and Mobile Internet Devices (MIDs). But if it seems familiar to long-time techies, it should; it's the same plan that worked in the early 1980s when Osborne and KayPro launched the first portable computers (albeit "portable" in those days meant 20-plus pounds).

There is a whole new set of factors driving interest in this latest generation of portable devices. For one, prices are lower than ever. Also, more ubiquitous Internet and Wi-Fi connectivity makes these portables more usable right out of the box. And ironically, the design philosophy of the late Adam Osborne, "adequacy is sufficient", remains in play.

In other words, there's always going to be a segment of the market looking to pay less for "good enough" technology.

"All of these new notebooks are characterized by limited functionality," Roger Kay, president of market research firm Endpoint Technologies Associates, told InternetNews.com. "Intel and the other players are looking to expand the market with lower-cost parts."

Analysts say the expansion began as an effort to reach emerging markets and education with more affordable computers. But the success of the Asus Eee PC has computer makers thinking about a broader target.

"What's thrown computer vendors for a loop is that the Asus gained consumer interest in U.S.," Tim Bajarin, president of Creative Strategies, told InternetNews.com.

The first Asus Eee PC was released last fall priced at $399. The two-pound notebook included a 7-inch screen, 4GB of solid-state storage, Wi-Fi connectivity and an Intel mobile processor.

Tuesday, Asus announced new models of the Eee PC that expand its line with bigger keyboards and screens. The Eee PC 901, due out next month, is based on Intel's latest Atom processor.

The new 901 features an 8.9-inch screen, Windows XP, a gigabyte of memory, a 12GB solid-state drive and Wi-Fi connectivity. Two other models, the Eee PC 1000 and 1000H, feature slightly larger storage and memory capacity, and 10-inch displays.

The 901 will be priced between $550 and $600, according to Asus spokesman Charlton Ho. That range overlaps with standard "value" notebook computers, but Ho insists Asus is targeting a different market.

"We're providing a totally different value," Ho told InternetNews.com. "You don't need [Microsoft] Vista on these devices," he said, which means less-demanding hardware requirements.

Also, the 901 weighs only 2.3 pounds and offers a longer battery life typical for low-end notebooks running Vista, he said.

Ultra-low cost notebooks a niche?

Research firm IDC is forecasting the market for what it calls "ultra-low cost notebooks" will grow to between 9 million and 10 million units a year worldwide by 2012, a small fraction of the overall market for notebook PCs.

What comes after Eee? Everyone from HP and Acer to Dell and MSI, not to mention class leader Asus, wants to star in the second generation of low-cost, just-right-for-traveling-light laptops. While IDC analyst Richard Shim thinks the Eee PC and other devices like it will have some mainstream appeal outside the education and emerging markets, he believes most U.S. consumers will opt for "true" notebooks from bigger-name vendors.

"The average selling price for notebooks is coming down," Shim said. If you have to sacrifice screen size and performance to get a $400 device or pay $550 for a name-brand notebook that's more functional with a 15-inch display, where will most people go?"

This article was first published on InternetNews.com. To read the full article, click here.






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