Netbooks are attracting buyers with low prices
They are portable, they cost $300 to $400 and their fast growth is changing the face of personal computing, says PC software king Microsoft.
Netbooks, or low-end notebooks, were the highlight of the third quarter. In an otherwise slow market, sales were strong. And that is likely to continue, Microsoft CFO Chris Liddell said Thursday.
They make for “a more interesting market” because now significant differences have emerged in what full-priced business customers and budget conscious consumers look for in a computer, he said. But “it becomes a lot more complicated from a forecasting point of view.”
That’s because it is hard to know whether netbook sales expand the market by attracting more price-sensitive buyers or are made in lieu of otherwise more expensive computers.
“That’s the phenomenon I don’t think any of us know at this stage,” Liddell told analysts on a first-quarter earnings call.
Nevertheless, they are helping to prop up market growth rates during tough economic times. Microsoft projects PC sales will be up 10 percent to 12 percent in the December quarter, about the same pace as the September quarter. For Microsoft’s full fiscal year ending in June, they should be up 8 percent to 12 percent, the company said, held back by the slow economy.
For consumers, the netbook trend is good news. Computers are available for less. For Microsoft, they represent a challenge. Netbooks ship with a lower priced copy of Windows, potentially cutting software margins at the company.
