Reports: Apple netbook to launch later this year

It's more likely to be an 'iPod Touch on steroids,' counters analyst

Rumors of an Apple Inc. netbook gained momentum today as the Dow Jones financial news service confirmed earlier reports that the company will launch a touch-screen-based computer, perhaps as early as the second half of this year.

Sources told Dow Jones Newswires that Apple is working with Wintek Corp., a manufacturer of small and midsize displays, to make touch-screen displays in the 9.7-to-10-in. range, with Quanta Computer Inc. assembling the netbooks.

Both Wintek and Quanta are based in Taiwan and have extensive operations in China. Quanta is the world's largest contract notebook maker and currently builds MacBook and iMac systems for Apple.

Dow Jones is the second source to claim that Wintek and Quanta are involved in Apple's plans to put a mini-notebook on the market. Yesterday, Taiwan's DigiTimes quoted a report in the Chinese-language Commercial Times that said Wintek would supply touch-screen displays and Quanta would build the new netbook. The Commercial Times also cited a second-half-of-the-year time frame.

Although netbooks -- loosely defined as small, lightweight notebooks that cost under $500 -- account for an increasing piece of the PC market pie, Apple has so far resisted entering that niche. Last October, CEO Steve Jobs famously dismissed the category. "We don't know how to make a $500 computer that's not a piece of junk, and our DNA will not let us ship that," he said at the time.

Since then, Tim Cook, the chief operating officer who is running the company while Jobs is out on medical leave, has also belittled netbooks. Cook, however, has left the netbook door ajar. "Right now, the products in there are much less powerful than customers want -- they have cramped keyboards and small displays," Cook said in January. "We think that the products there are inferior. But we'll see. We have some ideas here, and we're watching the space."

But Ezra Gottheil, an analyst at Technology Business Research Inc., said he doesn't expect to see a traditional netbook from Apple, assuming the reports out of Taiwan are accurate. "It's looking less likely to me that Apple will do a keyboard netbook," he said today. "What we're hearing [from Dow Jones] is consistent with an iPod Touch on steroids. With Apple's hostility to keyboards in general, I think this will be a touch-based device."

That's a change from his previous speculation on how Apple would address the booming netbook market. Last December, for instance, Gottheil predicted that the company would use this year's Macworld trade show to introduce a pair of netbooks. But that didn't happen.

"Apple's objective is not to take a piece of the netbook market but to grow its own market," said Gottheil. "They're thinking they can tear off some piece of the portable, price-sensitive, Web-browsing and, now, e-book [reader] market," he said. "That's my guess."

That's not to say Apple, or a third-party manufacturer, wouldn't come up with a wireless keyboard, or even package the touch screen and keyboard in a case, he added.

"I think they'll go more toward the trade paperback size, the [e-book] reader size," said Gottheil. "If you don't need a keyboard, you can make a device that is easily put into a purse, backpack, briefcase or even large pocket."

Copyright © 2009 IDG Communications, Inc.

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