Will Netbooks Eat Into Laptop Sales?

Cheap, increasingly popular netbooks are a blessing and a curse for PC makers: They’re a rapid growth market for some companies, like Acer and Asus. But they’re relatively low-revenue and low-margin. So will they end up being helpful add-on sales for PC makers — or costly cannibals?

Maybe both. Research firm ABI Research says 79% of survey respondents see netbooks as “secondary” devices — complements to laptops, smartphones, etc. That’s good news for companies like Dell and HP. And it backs up what Michael Dell said last fall: That netbooks would be “mostly a complementary product category” — providing new business from geeks and in emerging markets.

But 11% of ABI’s respondents say they’d use netbooks as their primary computer. Which is where the PC market suffers: Goodbye, $2,500, high-margin power machine, hello $400 plastic thing.

A 90%/10% split seems like a good deal for PC makers right now. (And Microsoft, who’s not selling many Vista licenses on netbooks, but mostly XP licenses.) But it’s a slippery slope: PC makers will have to make sure netbooks don’t get powerful or popular enough to cannibalise their high-profit laptop sales, or margins could take a dive.

See Also:
Apple On Netbooks: Mostly Garbage, But We Have Some Ideas
What Do Google Android Netbooks Mean For Microsoft And Apple?
Michael Dell: Netbooks Mostly ‘Complementary’, More 3G Deals Coming
Why Linux Netbooks Aren’t Killing Microsoft Windows (Yet)

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