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Acer tops Asus in fast-growing netbook market

But DisplaySearch lowers forecasts for overall notebook market

By Eric Lai
December 9, 2008 12:00 PM ET

Computerworld - The market for netbooks -- small notebook PCs with even tinier prices -- exploded in the third quarter of this year, according to market researcher DisplaySearch LLC, as vendors aimed their wares at students during the back-to-school season.

The global market for netbooks, also known as mini-notebooks, was 5.61 million in the third quarter, up 160% from the second quarter, according to a statement today from DisplaySearch, an Austin-based research firm.

Acer Inc. displaced Asustek Computer Inc. (Asus) as the netbook market leader for the first time during the quarter, taking 38.3% of the market, compared to 30.3% for Asus.

DisplaySearch expects sales of netbooks, which are lighter-weight, lower-powered and generally cheaper than regular notebook PCs, to hit 14 million by the end of the year. That's a sharp rise from 2007, when just 1 million were sold.

"Worldwide demand for these products is forecast to grow rapidly over the next few years, with demand from a variety of sources, including early adopters, consumer and enterprise PC customers seeking a smaller or secondary notebook PC, as well as new PC customers in emerging markets," DisplaySearch analyst John F. Jacobs wrote in a report. "We expect the mini-note PC market to settle at approximately 16% share of the notebook PC market by 2011."

Like Gartner Inc., DisplaySearch sees Netbooks as the one bright spot in the overall laptop PC market, which has shown signs of slipping.

DisplaySearch is revising down its growth forecasts for this year and 2009 because of "the challenging economic climate," Jacobs wrote, adding, "Even enterprises that are maintaining or growing are likely to stretch their PC replacement cycles out as long as possible."

In the overall laptop market, Hewlett-Packard Co. leads with a 19.7% share, followed by Acer with 17.1%. Acer also sells notebook PCs under the Gateway and Packard Bell brands. Its sales were up 65% year over year.

Dell Inc. was third with 13% of the overall notebook market, followed by Toshiba and Asus, each with 8.6%. Apple Inc., which does not sell netbooks but has seen strong laptop sales growth in North America, ranked seventh worldwide in notebooks, with a 4.1% share. Apple's sales were up 24% year over year, and some analysts have speculated that the company will release its own netbook in 2009.

Asus, which was a marginal laptop player before introducing its $400 Eee Netbook PC last October, saw its notebook revenue, which includes netbook sales, grow 189% year over year.

Asus had taken lead in the netbook market by releasing variations on its original Eee in different sizes, at different prices and with different operating systems (both Windows and Linux). But Acer, driven by strong sales of its popular Aspire One, overtook Asus, shipping 2.15 million netbooks in the third quarter.

HP held third place, with 5.8% of the market. Its main netbook model is the Mini-Note 2133. In fourth place was Taiwan's Micro-Star International (MSI), whose Wind Nettop model held 5.7% of the market.

In fifth place was Dell, with 2.8% of the market, followed by the nonprofit One Laptop Per Child organization, which shipped 130,000 of its low-cost PCs in the third quarter for 2.3% of the market.

Looking further down the list, Lenovo was in ninth place, shipping just 40,000 units, followed by Toshiba.

Taiwanese makers such as Acer, Asus and MSI hold three quarters of the netbook market today. However, DisplaySearch said that it expects "the dominant PC brands [to] continue to gain share in the [mini-notebook] PC market due to brand power and recognition, and lower cost structure."

Read more about Hardware in Computerworld's Hardware Topic Center.



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