The netbook grips the market

In today’s world of convenience and convergence, most working professionals would confess to being acutely dependent on the computer and the Internet. How about then, if these essentials come together in a lightweight platform that you could carry around anywhere? This is exactly what you can do with the smaller and no-frills netbooks that many PC manufacturers are releasing these days.

Ever since the launch of Intel’s Atom processor, the same size as that of a one-rupee coin, computer makers have been engaged in a war to woo customers and establish themselves as the market leader in the netbook segment. But the problem is: With something as small as a 200-page hardbound book, how do you set it apart from competition?

There’s little room in terms of adding features to a netbook. A netbook is essentially a no-frills PC for the casual user. This means that there’s usually no CD ROM drive and at times very little hard disc space than its bigger brother, the notebook. Moreover, the computing power is also lower than a conventional notebook. This, however, results in a longer battery life.

The main concept behind the netbook is that it’s a light machine, used mainly to connect to the Internet. As the pricing and positioning of the product differs, companies add on features like a camera or a high resolution screen. Some have even moved out of the generally accepted specifications of netbooks to offer an even higher disk storage space, but at a premium obviously.
Low pricing

Lower pricing than laptops is one of the most attractive features of netbooks. Says a spokesperson for Sonal Infosoft India, a multi-brand PC dealer, “Economy brands like Acer, ASUS and HCL tend to show more sales, purely due to their pricing. They fall in the Rs 18,000 to Rs 21,000 range.”

Says Acer’s Chief Marketing Officer, S. Rajendran, “Highly portable, netbooks are becoming increasingly popular as they allow users to hook onto the internet anytime from anywhere. The pricing is around Rs 20,000; and with this category proliferating with variants (higher screen sizes and gesture sensitive touchpads), the price band stretches up to no more than Rs 25,000.” In 2008, ASUS was one of the first companies to bring out netbooks. Priced initially in the sub-Rs 20,000 category the company has now expanded its portfolio after witnessing surging demand from consumers. Says Stanley Wu, Country Head, Notebooks & Eee PC Business, ASUS India, “India is an upcoming consumer hub for diverse computing products. The first Eee PC was launched in India in January 2008 and it received a great response from the consumers. ASUS has rolled out many models of the Eee PC and our products are in the price range of Rs 21, 000 to Rs 31,000.”

Sumanata Mukherjee, Lead PC Analyst, IDC India, says: “Asus and HCL launched their Netbook models early in 2008 and so were able to get a first-mover advantage in this new, emerging segment. The pricing decisions of the respective netbook vendors is a result of the positioning they have selected for their Intel Atom processor-based offerings.”

Lifestyle computing

But not all companies have a similar market strategy. Catering to the premium segment, Sony prefers marketing its smaller laptop, the Vaio P, as a ‘lifestyle PC’, rather than a netbook. “The smallest PC that we have is Vaio P, easily mistaken as a netbook. It is the size of a business envelope, roughly as thin as a cell phone and easily slips into a pocket or a handbag,” says Sachin Thapar, Head, Sales and Marketing, IT, Sony India.

Essentially, there is little difference between other netbooks and the Vaio P series. Similar to netbooks offered from other companies, these too run on the Intel Atom processor, mostly offer lesser storage capacity and have no optical drive. However, the price band of Rs 50,000 to Rs 65,000, coupled with features such as camera, high screen resolution and snazzy design, puts the Sony Vaio P in a class of its own.

However, unable to stay away from the rapidly growing market, Sony recently announced the Sony W series, according to media reports. With its global launch in August, the company may finally enter the netbook market officially.

Another company which has successfully marketed lifestyle computing is Hewlett-Packard. HP was at the forefront of offering trendy designs on notebooks and has now introduced it in its netbook range. Priced slightly higher than its competition, it is designed for the fashion conscious consumer.

Says Diptesh Ghosh, Country Manager, Consumer Notebooks, HP India, “The HP Mini is designed for people who want a light-weight notebook with premium appeal at affordable pricing. A specific target segment is the working women who need a laptop that is light on shoulders, great on performance and heavy on the style element.”

Popular among business executives

When netbooks initially came out, people thought it would be more popular among students and the young crowd. However, an equally big market has been the business executives and professionals who need the Internet on the go.

Says Ranjit Yadav, Director - IT, Samsung India, “Our netbooks are targeted at the household consumers – young students, professionals who do not have heavy computing needs as well as business executives who travel a lot and would like a light and dependable machine to access the Internet and meet their computing needs while on travel.”

Even ASUS agrees that the minimalist features of netbooks are a huge attraction for business executives. “The netbook is a perfect companion for professionals, students and businessmen, specifically for people who travel a lot. The trend is catching up as we see people opting for a netbook as compared to a conventional notebook due to their own basic requirements, such as surfing and office applications,” says Wu.

Acer’s Rajendran concurs. He says, “The netbook is likely to be adopted faster by SME executives and government officials due to its USP of being a compact, affordable and connected machine.”

Growing Segment

Netbooks have been revolutionary in creating a whole new segment in the personal computers market. Says IDC analyst Sumanta Mukherjee, “While the initial netbook models that hit the market were ‘stripped down’ versions of their notebook PC cousins, later models also feature hard disk drives. In this avatar, netbooks have been able to open a niche market of casual computer users – primarily net surfers and executives looking for a lighter, no-frills PC for use during travel and business meetings. This segment would be interesting to watch in the months ahead.”

According to IDC figures, when netbooks first came into the market in 2008, 37,000 units were shipped into India, compared to 2.3 million units of notebook PCs. But, this year the industry is projecting much larger sales figures. The unanimous opinion from companies is that this segment would grow very fast, with netbooks soon becoming an important part of their product line-up.
While ASUS feels the Indian netbook market would double itself this year, Samsung expects netbooks to contribute 50 per cent of its total notebook sales this year. Samsung also aims to garner a 7-8 per cent share in the Indian market by next year.

Acer, which already has a 40 per cent market share in the Indian market, sees a tremendous potential in India. “We expect netbooks to be popular in India too, especially among small and medium businesses, and also as a second computing device in upper-middle class homes.
We expect the Indian netbook market to be around 3 lakh units this fiscal year,” says Rajendran.
Indian computer major HCL is equally bullish about the netbook market. Says George Paul, Executive Vice-President, HCL Infosystems, “Going forward, the market for netbooks looks promising, as its demand will rise gradually with the increasing availability of internet bandwidth and GPRS/3G mobile connectivity across the country.” Clearly, the netbook is ready to slip into more bags.