It doesn't matter how badly Intel wants its Ultrabook initiative to succeed if the chip maker's hardware partners aren't up to the task. According to IHS iSuppli, they've fallen way short up to this point, and as a result, the market research firm cut its near-term shipment forecasts from 22 million units globally to 10.3 million units. That's a 53 percent downward adjustment, and PC makers have only themselves to blame. How so?
Put simply, high prices and nebulous marketing are holding Ultrabooks back.
"There once was a time when everyone knew the 'Dude you're getting a Dell' slogan. Nowadays no one can remember a tag line for a new PC product, including for any single Ultrabook," said Craig Stice, senior principal analyst for compute platforms at IHS. "So far, the PC industry has failed to create the kind of buzz and excitement among consumers that is required to propel Ultrabooks into the mainstream. This is especially a problem amid all the hype surrounding media tablets and smartphones. When combined with other factors, including prohibitively high pricing, this means that Ultrabook sales will not meet expectations in 2012."
Not meeting expecations is one thing, but Ultrabook sales aren't even coming close to previous projections. The same will be true next year, as IHS iSuppli slashed its forecast for 2013 from 61 million Ultrabook shipments to 44 million.
In order to turn things around, IHS iSuppli believes that PC makers have to get a larger number of Ultrabook systems down to around the $600 range. To be fair, prices have been falling in recent months, but there are a large number of models that still sell for around $1,000 and not nearly as many that sell in the $600 to $700 range. Low cost tablets aren't helping Ultrabook sales, either.
"With the economy languishing, Ultrabook sellers may have trouble finding buyers at the current pricing, especially with fierce competition from new mobile computing gadgets such as the iPhone 5, Kindle Fire HD and forthcoming Microsoft Surface," Stice added.
There's still hope for the form factor. As prices come down, new technologies like Intel's Haswell platform will bump up performance while also reducing power consumption and adding features like Intel Identity Protection Technology.