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DisplaySearch: Tablets eating away netbook growth

Posted on Wednesday, June 16 2010 @ 22:01:47 CEST by

DisplaySearch has published a new report about the global laptop market. The company notes last quarter saw big gains in shipments, and notes tablet and slate devices like the Apple iPad are starting to impact the netbook market's growth. Here's the full press release.
In Q1’10, revenue for the total notebook PC market grew to US$31.32B, the largest single quarter since Q3’08 when notebook ASPs were more than 20% higher than at present. Although ASPs declined for desktop replacement notebooks, they increased for every other category with double-digit jumps for mini-note PC/slate and ultraportable categories, according to the DisplaySearch Q2’10 Quarterly Advanced Notebook PC Shipment and Forecast Report.

ASPs in the mini-note PC/slate category were not impacted by Apple’s iPad since the product was not shipping in Q1’10. Rather, the introduction of new models with more features and second-generation CPUs helped to push up set prices and increase revenue for the category. In the ultraportable market, a new crop of products that were launched in and around the January CES show helped push revenues up 6% Q/Q, but they were still well below year-ago levels, as this category, which tends to be dependent upon the enterprise market, continued to struggle.

The positive Y/Y revenue growth in Q1’10 was a result of very strong mini-note PC/slate growth in Latin America and the Asia-Pacific, as well as continued growth in China and North America. Shipments of portable class notebook PCs surged Y/Y in Asia-Pacific, China, and Latin America, easily passing average market growth rates for the segment. Shipments of desktop replacement class notebook PCs surged Y/Y in Europe/Middle East/Africa and Japan.

Shipment growth in the mini-note PC/slate category exceeded the average for the notebook market as a whole, but it appears that the momentum is shifting from mini-note PCs to slates. In Q4’09, there were no consumer-oriented slates in the market, and the devices that did exist were targeted at small, vertical markets. In Q1’10, Apple shipped almost 700K iPads into the channel, accounting for 6.5% of all mini-note PCs/slates. In the first two months of Q2’10, the company sold more than 2M iPads. DisplaySearch expects that the iPad will continue to account for an increased share of the mini-note PC/slate segment in Q2’10. In the second half of the year, as additional slates are launched, the clamshell-style mini-note PC (netbook) could continue to lose share.

Low priced clamshell-style mini-note PCs have made these products attractive to buyers seeking a secondary or tertiary PC. They have also lowered the entry barrier for first-time PC buyers in emerging markets. However, with the emergence of the iPad and other slates, this segment of the market is transitioning from devices that, though smaller and less expensive, followed typical PC market trends that are built upon Office suite applications and content creation to devices that provide the ability to create content, is more focused on an a la carte method for selecting the software capabilities (apps) of the device and content consumption.

“The last quarter of 2007 heralded the birth of the mini-note PC (netbook). Q1’10 signaled the birth of the slate PC, and possibly by extension, the beginning of the end of the mini-note PC (netbook). Apple has ported their successful iPhone app business model to the iPad. Android-based phones followed in their footsteps and will surely do the same with slates. The result will be that buyers of slates will be able to take advantage of this a la carte software model, adding only the functionality they want on their devices,” said John F. Jacobs, Director of Notebook Market Research.

Jacobs added, “The implications of a successful slate market to the display and PC industries are significant. Clamshell style devices have hinges that are easily manipulated to position the display at an angle that best utilizes a relatively narrowing viewing angle. Slates, with their focus on portability and media consumption and without a clamshell to protect the display, will be used in a wider variety of settings than netbooks. Therefore, they will require very durable, very thin, very bright, very color-saturated displays that consume as little of the battery power as possible.”



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