Netbook Sales To Hit 36 Million In 2010

Businesses buying more of the mobile devices than consumers, but the overall trend will begin to decline by 2011, predicts research firm Techaisle.
Businesses and consumers will purchase 36 million netbooks in 2010 globally, according to research firm Techaisle, which said Monday that the figure reaffirms its initial forecast released in mid 2009.

Business netbook penetration will be 5.3% and consumer netbook penetration will be 1.8%, said the firm. There will be a "short and transient shift of netbook purchases among consumers from some mature markets into a few newly emerging markets," in 2010, the firm said in a statement. European businesses will continue to adopt netbooks "in decent numbers" during the same timeframe, and they are especially popular with small retail shop owners, Techaisle said.

While netbooks created a strong market in 2009 by their ability to address latent mobility needs, thereby attracting new buyers, starting in 2011 through 2013 or 2014, netbook sales will be on the decline, the firm said. Market expansion will be limited by the "value proposition differential," said Anurag Agrawal, CEO of Techaisle, because "there is no compelling reason for a consumer or a business to buy a netbook as compared to a notebook."

In 2009, netbooks were highly sought after devices because they were new, the economy was down and they were relatively inexpensive, making them attractive to both businesses and consumers, explained Agrawal. "But the important thing was consumers were not buying them in numbers -- because they decided if they spent another $200 they'd get better a notebook." Businesses, on the other hand, were buying netbooks to supplement their main computing devices, he said.

"We were getting feedback from the market that it's not the beginning of an era, but the start of a short trend," added Agrawal. Although netbooks were touted as a great alternative device for emerging markets like Brazil, Russia, India, China, Indonesia, and the Philippines, where PC penetration is very low, consumers did not gravitate to them as expected, he claimed.

Agrawal said netbook vendors need to promote the device to businesses as an alternative for functions that fall short on smartphones, such as PowerPoint presentations, webcams, and web conferencing. "That's where you can open up the market for netbooks,'' he said.

Agrawal claimed netbook forecasts by other research firms are now being revised down since sales have not lived up to expectations and they are only good for internet browsing or taking files on the road.

Techaisle's netbook sales projections are significantly less than what at least one other analyst firm has forecasted. ABI Research recently predicted about 60 million netbooks are expected to ship worldwide this year, a figure that will almost double by 2013. ABI Research also said the netbook market would begin to decline in 2014-2015.

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