Rachel Metz

"Smartbooks" are meant to combine the constant Internet connectivity and long battery life of a smart phone with the classic shape and keyboard of a laptop. (AP Photo/Lenovo Handout)

From Netbooks to Laptops and Smartphones to Smartbooks

San Francisco. Small and inexpensive netbooks were among the most popular computers during the recession, wooing consumers with their portability and prices often below $400. Now, with economies improving, consumers will be asked to open their wallets to new styles of computers, including some costing a bit more.

Among offerings unveiled at this week’s International Consumer Electronics Show in Las Vegas — lightweight, medium-sized laptops meant as a step above netbooks in price and performance. There will be at least one “smartbook” — a tiny computer combining elements of netbooks and smartphones.

That is not to say the netbook has reached the end of its line. PC makers including Hewlett-Packard, Lenovo and Toshiba are showing off new netbook offerings with such features as touch screens and the latest Intel Atom processors, offering better performance than the earlier Atoms that fueled the first netbooks.

But the netbook’s popularity has come at a price for the computer industry: slim profit margins for chipmaker Intel and PC manufacturers.

For many PC makers, the rise of netbooks meant falling revenue and profit from PC divisions. Hewlett-Packard, the world’s largest computer maker, gets a third of its revenue from its PC business but just 15 percent of the company’s operating profit, numbers that are shrinking thanks to netbook sales and price cuts on other machines.

And while netbooks proved that there was an appetite for highly mobile computers, consumers will likely come to want more power, more portability — or both.

Ever since Taiwan-based AsusTek Computer got the netbook craze going with its 17-centimeter Eee in late 2007, consumers have been gravitating to the devices. Research company Gartner said netbooks made up an estimated 10 percent of all PC shipments in 2009, up from 4 percent a year earlier.

These devices had small screens — generally 28 centimeters, compared with about 43 centimeters on a full-sized laptop — and often smaller-than-normal keyboards. PC makers kept prices down by avoiding extras like DVD drives and Bluetooth connectivity.

Netbooks were meant to be companion devices that could slip into a purse or backpack for on-the-go Web surfing, though for many consumers it was the only computer they bought in 2009.

But only so many people can buy netbooks as secondary computers, and people who buy them as their only computers will eventually trade up to more powerful machines, John Jacobs, an analyst at market research company DisplaySearch, said.

Thus, the growth in netbook sales is likely to slow in the next few years. Although netbook shipments to retailers more than doubled in 2009 to 33.3 million, compared with the previous year, shipments should rise just 19 percent to 39.7 million this year, according to DisplaySearch.

In addition to netbooks, consumers can expect to see in stores a number of devices that fit above and below the small laptops in price, size and performance as PC companies try to widen the market. Many of these are being unveiled at CES.

Lenovo is banking on smartbooks, which are meant to combine the constant Internet connectivity and long battery life of a smartphone with a laptop’s classic shape.

The company’s first smartbook, the Skylight, has a 25-centimeter screen, full-size keyboard and 10 hours of battery life and weighs less than 0.9 kilograms. It will be available Jan. 12 with prices starting at $350.

While DisplaySearch expected netbook growth to slow markedly in 2010, it was still projected to make up about 20 percent of the portable computer market, slightly above the market share in 2009. And Gartner believed netbook shipments would grow to 12 percent of all PC shipments in 2010, up from the estimated 10 percent last year.

Philip Osako, Toshiba’s director of product marketing, said that although the weak economy helped netbooks take off, an improvement should not mean fewer sales. “I think what netbooks have done is really opened consumers’ eyes to the concept of mobility,” he said.



Associated Press

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