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Netbook sales set to soar - or not

Reading the tiny tea leaves

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Netbook sales will continue to be strong for the foreseeable future - the only question is how strong.

Between 25 and 30 million of the little fellows will be sold this year, but according to a report Monday by the Taiwanese tech-news site DigiTimes, "some netbook players" are forecasting that 2010 will remain flat, with a like number being sold next year.

However, DigiTimes also notes that the president of Compal Electronics, Ray Chen, is more bullish about netbooks, predicting that their sales may hit 35 million in 2010.

Seeing as how Compal makes netbooks for such heavyweights as HP and Acer, we believe he may have some inside information about his customers' projections.

Today's prognostications come a few days after last Thursday's report by the researchers and analysts at Canalys, which might be best summarized by one quote: "The impact of netbooks has been profound."

According to Canalys, over 13.5 million netbooks were sold during the Meltdown-depressed first half of this year - a figure that makes the prediction of 25 to 30 million to be sold throuhout the year seem more than doable, especially considering the traditionally strong back-to-school and holiday seasons for consumer devices.

Prime suspects

And consumers are the prime market for netbooks. As The Reg noted two weeks back, a recent study by Spiceworks of planned SMB purchasses found that although 55 per cent of those surveyed planned to purchase laptops in the next 18 months, only 13 per cent planned netbook purchases.

But clearly, someone is snapping up netbooks. As DisplaySearch recently reported, netbook sales were a mere 5.6 per cent of the portable-computer market in the second quarter of 2008, but grew to 22.2 per cent in the same quarter this year.

Except that DisplaySearch calls them "mini-note PCs". And Microsoft has renamed them "low cost small notebook PCs" - despite our help in sorting out the telltale markings of a netbook.

But we digress...

The Canalys report is clear on what's driving netbook adoption worldwide: "The biggest change of all has been the success the telcos have had in selling subsidised 3G netbooks, emulating the mobile phone business model."

More than 50 telcos have begun subsidizing netbooks, according to Canalys, with HP leading the way in deals and Samsung "rising quickly." In the US, both number-one wireless provider Verizon and its number-two competition AT&T have inked netbook-subidizing deals, and subsidization partnerships are spreading throughout Europe and Asia, notably in Korea, China, and Japan.

Netbooks are clearly here to say. As to doubts about viability of the netbook market, Intel's PC Client Group boss, Mooly Eden, recently said at a company technology forum: "When people asked this question a year ago, it was fair. Nobody knew. But to keep asking now with more than 25 million [sold] - you can do the analysis, you can check in the market, there are answers."

And the answer is "Yes." The only question is how high and how fast their success will increase. ®

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