About one and a half year ago, I wrote about the turning point of PC market with the introduction of netbooks. Recently, market researchers are dishing out reports claiming that the hype of netbooks might just be over. One main cause cited is the birth of iPad, a reincarnation of tablet PCs (though it’s not so PC). In just 80 days, iPad sales hit 3 million in all sorts (just a few days ago, Apple reported 4.2 million iPad sold). Projected sales for netbooks will dip, giving a sense of passing its peak.
Big guns such as Intel, and AMD suggest otherwise. Sales of netbooks estimated by ABI Research will hit 58 million this year, up from 39 million in 2009. This is about 19 times that of iPad’s. If this is to represent the full potential for iPad in years to come, then this might be motivating for Apple (as it translates to about $28 billion revenue). However, this might not be the story that will unfold in the future.
First of all, when iPad was launched this year, its immediate target seemed to be Amazon Kindle: adding e-books to list of offerings from its online store, iTunes (now it is already selling audio and video products). The noble idea of using the same platform as iPod and iPhone has extended the capabilities of iPad; way beyond a user-friendly and visually enticing book reader.
Availability of 300,000 over applications marked the growth of the eco system around Apple’s i-family. It reminds us all of why computers come to our lives. It is not because computers are intelligent machines that can perform complex calculations and run simulation models. The uses of computer were greatly extended by the range of applications running on it. Physically, it look just as normal as any standard IBM PC/AT machine. Inside, its capabilities are determined very much by the types of software you run on it. The growth of software applications was further fueled by the growth of networking (or Internet simply). Connectivity then became the reason why people purchase PCs. E-mails and web addresses replaced those of the postal equivalents. There remained a problem: it’s really inconvenient to bring your desktop outdoors, hence keeping your productivity indoors. Laptop provided the solution to this.
Coincidentally, the advent of mobile phones broke the same barrier faced by telephone users. To cut the story short (as everyone in this age should know), innovation for mobile phones continued for some 20 years on. To date, mobile phones are closing gaps with those of mobile computing though the magnitude of the distance remains huge. This is especially true in terms of software applications.
Coming back, iPad has an entry price that is way off that of netbook. In this sense, Apple has positioned iPad in a totally different target market, even in competition with Kindle. It is also in this perspective, that I think, iPad won’t replace netbooks. They are basically 2 different types of animals: built and sold differently. To be exact, iPad is replacing the dead tablet PCs: something not in Apple product lineup. This revival is slightly in nature (used to be Windows-powered with sliding/turning effects), but has been successful so far. In my own words, it is simply an old story told in a new manner (improved from the previous experiences).
However, this doesn’t translate into good news for netbooks as well. The fight for the money in the consumers’ pockets is still on. In existing economic conditions, every dollar spent on these intelligent devices (machines are bigger in size) could affect the very survival of their makers. Netbooks have a contrasting image: cheap. It’s good to be cheap as it guarantees volume but lacks the potential for growth. For me, netbooks are in the matured stage of the product life cycle. Its amazing rise to stardom has also resulted its rapid climb to the top.
It’s time for Netbook 2.0 or something similar. It is not about competition with iPad, but rather its very own livelihood. Of course, an ordinary netbook on the shelf will still command some interest from needy users. High-end netbooks (with HDMI connection for example) has to be downgraded to attract existing users. In fact, more could be offered: 3G connectivity and sensors capabilities). This will bridge gaps with iPad and even AppleTV, as well as its Google equivalents.
In closing remarks, who hates a cheap and handy device that provides the basic needs of modern day computing?
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