ASUS and Acer dropping netbook market

DigiTimes heard Intel may be forced to alter its Atom roadmap as ASUS and Acer, the top 2 netbook vendors, are both phasing out their netbook product lineups. ASUS has already halted its Eee PC product lineup and is in process of selling any remaining inventory, Acer hasn't yet made any plans to open new netbook projects, indicating that the company may also plan to call quits on netbooks, and MSI also has no plans to continue shipping netbook related products.

Additionally, the arrival of Microsoft's Windows 8 operating system is expected to take a have toll on the netbook market due to higher license fees, as well as higher hardware costs due to the requirement of panels with higher resolutions and touchscreen functionality.

Although Atom series processors will still be adopted by handset and embedded products, the sources believe the two product lines are unlikely to be able to fill the gap created by the absent netbook products in short term due to weak shipments.

Asustek CEO Jerry Shen recently confirmed that the company will stop production of Eee PC netbooks using Atom-based processors such as the N2600 due to impact from tablet PCs and notebooks, as well as a sharp drop in demand in emerging markets. Asustek plans to have its Transformer tablet PCs fill the 10-inch mobile device market, replacing its netbook product line.