No. 2 IT distributor: No Linux netbooks for you

Tech Data does not sell Linux netbooks because it has seen 'almost no' demand

Netbooks may be booming for IT mega-wholesaler Tech Data Corp., but Linux models are not part of the equation.

Netbook shipments are up "in the triple-digit percentiles" over a year ago, said Brian Davis, vice-president of client systems for Tech Data. But he said Tech Data has seen "almost no" demand for Linux netbooks.

As a result, "we're not even sourcing any Linux-based netbooks anymore," Davis said.

His comments come as a surprise, given that while Windows netbooks may dominate in the U.S., market research shows about a quarter of netbooks sold worldwide last year came with Linux.

That Tech Data does not even bother stocking Linux netbooks could be a bad sign for shipments this year. The $24 billion-a-year wholeseller is ranked by Hoovers as the second-largest IT distributor in the world behind Ingram Micro.

Davis did not explicitly blame Linux's capabilities. Early Linux netbooks tended to come with smaller screens and lower-capacity solid-state drives (SSD), which "just wasn't adequate," he said. Also, Tech Data tends to supply more resellers with business or government clients than those selling to consumers, he said.

Tech Data does not handle returned products, so Davis declined to comment on whether Linux netbooks are returned more often than Windows versions.

U.K. electronics chain Carphone Warehouse said late last year it would stop selling Linux netbooks due to return rates of as high as 1 in 5.

Davis confirmed that netbooks from Acer Inc., Asus Inc. and Hewlett-Packard Co. are all selling well, as are models from Lenovo Group. Models with a 10-inch screen and 160GB hard drive and Windows XP Home are selling the fastest, he said.

He says netbooks contributed to the demise of the OQO, a more powerful but pricier Windows handheld PC aimed at specialized business markets. Following rumors, OQO's maker officially went out of business last month.

With netbooks, Davis said, "Suddenly, you had a very capable machine at a much lower price point."

Still, netbooks have yet to generate huge sales in many vertical markets yet, except for schools.

"I move boxes, so in truth, I'd rather sell a $1,200 notebook than a $400 netbook, but with schools, you are creating a market," he said. "The typical public school wasn't going to buy a notebook for every student, but they are starting to with netbooks."

Davis said coming netbooks running the ARM processor and the Linux-based Android operating system are "interesting."

"We're taking a wait-and-see approach," he said. "The ARM guys will have to fight very hard to invade this space. It will be a very difficult proposition."


Copyright © 2009 IDG Communications, Inc.

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