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Netbooks Sell Well but Don't Make Money

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Netbooks really help the overall sales figures for PCs, but as it turns out, they aren’t so great for the bottom line. It’s the highly attractive price of netbooks that keeps them in high demand. This might actually be a negative trend for PC makers, according to market research firm, DisplaySearch.

John Jacobs, director of notebook research for DisplaySearch, said, “…the lower [average selling price (ASP)] of these devices are clearly having a negative impact on portable PC market revenue. For 2009, we expect continued ASP erosion across all portable computer categories, leading to the first [year-over-year] decline of portable computer revenue.” Netbooks are currently responsible for a staggering 21.5% of PC shipments. Even with these unit numbers, they only make up 10.9% of revenue.

Sales prices of full size notebook computers have been pushed down considerably by the netbook bonanza. Notebook prices are down 10% in the last year.  This may be an unsustainable trend in the PC market. The trend is, however, expected to continue next year.

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COMMENTS:4
COMMENTS
avatar boo hoo i'm not making as

 boo hoo i'm not making as much money on my over priced notebook as i could have boooo hoooo

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avatarNetbooks are easier to lay in bed with!

I'd say its a good thing, it gives people who wouldn't be able to afford a laptop otherwise a chance & not just in the States. Also, while there are power users out there, most people I know simply want to finish something for work, school or browse online. Its not like everyone out there needs a PC for "Video Editing" or "Gaming" although its fun to have that. That's why Acer made a smart move by putting a 160GB hard drive in its Aspire One. & if you hook up an external large monitor like I did for my wife, if all she does is stuff for work, school or online crap then its fine.

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avatarSo, they need to be making fewer or different machines, right?

1. Since the price of "factory repair," on notebooks has been sky-high for a long time, a lot of independent repair people won't crack open a notebook ---or only if it's to replace the LCD or keyboard; Low profit margins on these machines makes a lot of sense to me. (Relatively, they're kind of "disposable" PCs.)

2. If they were/are willing to sell netbooks on such narrow margins, it kinda sounds to me like the manufacturers --maybe-- can afford to sell all their "portable" products on similar margins. Maybe they could have, quite some time ago --they've just preferred to maximize profit.

I read this as Capitalist "market forces." It's not like they could stock-pile the components for these, instead of selling off stock, and expect to get a bigger profit in 6-12 months. (It's possible they could, but I certainly wouldn't put MY money on that.)

It's nice, that the consumer is benefiting from these things, for once...

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avatarPro desktop, netbook

 I'm pro netbooking, AS A SECONDARY COMPUTER, much like an all in one, something for browsing the web in a nice little small package. Where I work, so many consumers look at a cheap little netbook, then a larger HP or Toshiba and think, 'what's the difference? why pay twice the price as a netbook for a laptop or a tower?"Try explaining that to your average country bumpkin. No easy feat. Netbooks are cool, but they're gonna pound a stake into the laptop/desktop market FOREVER. OEMs, (who sometimes already use secondhand or cheap quality parts to save a buck) are only going to slash prices and deliver inferior products to suffice the 'netbook' needs, as far as pricing goes at least...

 

 

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