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HP CEO Mark Hurd says it will be a while before HP can offer a firm metric on netbooks

Netbooks have become a major category for most computer makers. The sole holdout among the major PC makers not offering a netbook continues to be Apple. Consumers have flocked to netbooks for many reasons; one of the most significant being price.

Many analysts and reports claim that netbooks are cannibalizing sales of more expensive notebooks that are on the market. EWeek reports that HP CEO Mark Hurd talked about the cannibalization of higher-end notebook sales by offering low cost netbook computers.

Hurd said, "I've seen in print, from people who claim expertise, that 80 percent of netbooks is new [sales] and 20 percent is cannibalization of the bottom part of the notebook market." Hurd also says that HP has "some time" before they can offer a usable metric regarding cannibalization of sales caused by netbooks.

The reason for this is that HP is relatively new in the netbook market. Hurd does say, "It's not the move to netbooks that's cannibalizing. What you have is someone buying a more thickly configured notebook, who's now buying a more thinly configured notebook, and that's what's adjusting the ASP [average selling price]."

This accounts for one of the reasons shipments are up for many computer makers, yet revenues are down. Many wonder with the current poor global economy is it wasn't for netbooks, would consumers be buying new computers at all.

IDC forecasts that netbook sales in 2008 are going to be about 10 million units. The overall notebook market is expected to ship 142 million units meaning that netbook shipments are only 10% of overall notebook shipments.

Analysts also say that smaller computer makers like Acer are using the netbook to grab market share from the big players in the industry like Dell and HP. Acer currently has the most popular netbook on the market with its Acer Aspire One. IDC analyst Richard Shim said, "A year ago they [the smaller PC vendors] were hardly in the market, and so the gross rate is pretty exceptional."

Shim told eWeek, "In just over a year, they've (netbooks) evolved from these Linux-based, solid-state devices into fully [Microsoft] Windows OS-based, 120GB hard drive systems, which are very similar to traditional notebooks. So we've had a dual effect here, with many netbooks becoming more robust and expensive, while notebooks have come into the same price range."

The line between the netbook and the notebook is certainly blurring. Sony introduced its VAIO P that is a netbook in all but name yet carries a price tag of a notebook system. At the same time, Dell has a 12-inch Mini 12 netbook that is sized like a normal notebook computer but priced like a netbook. What we may see in the coming months is that while some notebook users defect to cheaper netbooks, some netbook users will at the same time be defecting to more expensive and more robust notebook computers.

The question of cannibalization of existing products isn’t only being asked to computer makers. Many are asking the same thing of Intel with the massive success of its cheap netbook processor, the Atom. When Intel unveiled the new Atom N280, it offered little in performance gain compared to its predecessor the N270. Many felt that the miniscule performance improvement in raw power was directly related to Intel's desire to not cannibalize its faster processor sales where profit margins are higher.

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N280 clocks
By Mr Perfect on 2/20/09, Rating: 0
RE: N280 clocks
By omnicronx on 2/20/2009 3:28:27 PM , Rating: 2
The clockspeed and FSB bump will barely be noticeable (aside from the slightly lower TDP of 2W vs the 270's 2.5W), the big advantage of using the n280 is the ability to make use of the GN40 chipset. (as you have pretty much stated)

Keep in mind the GN40 also has around the same power draw as the again 945 chipset with all of its added features aswell.

It should be able to play 720p video and should be able to run Aero which opens the door to using vista instead of XP.
(although the benefit may be little to nothing for the vast majority of netbook users i.e doesnt take much video power to perform your daily tasks)

RE: N280 clocks
By mindless1 on 2/20/2009 4:29:23 PM , Rating: 2
Netbooks run optimally with a small footprint OS, Vista on one is a mistake. Win7, IF it ends up being a significant enough reduction in resource usage, may be a bit of an improvement over Vista though it'll still be arguable whether that or XP is a better choice (ignoring 'nix for a moment, if one could get something like puppy linux running that could be ideal for a lot of the netbook users' needs).

RE: N280 clocks
By elpresidente2075 on 2/20/2009 10:00:51 PM , Rating: 2
Win7 on a netbook is more efficient than XP. I have compared the two in daily usage on my Hp Mini (wonderful little thing, by the way) and 7 is faster than xp in many tasks, and in some ways more stable, even as a beta.

Case in point: when I loaded up Counterstrike Source in xp, it would load half way and hard crash due to video memory management issues. Install 7 and the game loads up and plays with no complaints from the system. The game's still as slow as molasses, but that's not the point, the point is better memory management and other process improvements that have served to bring 7 back down to xp hardware requirement levels, perhaps even lower.

RE: N280 clocks
By StevoLincolnite on 2/20/2009 10:33:54 PM , Rating: 1
To be honest... I don't see Windows 7 being any more efficient than Windows XP, It would run like crap on a Pentium 3 500, 128mb of ram and a TNT 2 which Windows XP would run fine on.

The crashing issues you stated there could have been driver related or user errors, and that can happen on any Operating system.

However not all is doom and gloom, I'm running Windows 7 Build 7000 on my Netbook and Toshiba Notebook, It's a much better experience than Vista has been, it does have it's problems like all Beta's though. (Ready Boost still needs more work done on it...).

However you still cannot install it on an EeePC 2g or 4g surf models, it simply consumes to much HDD space, Office 2007 also takes up far to much space to install on such models also, I do have them both installed though, with a 16gb flash disk, which is a minor annoyance.

Performance wise, XP runs better on the EeePC Surf models than what Windows 7 does with the Celeron M based processors.

RE: N280 clocks
By Myrandex on 2/21/2009 8:57:26 AM , Rating: 2
I don't know how you figure that windows XP will run fine on a Pentium 3 - 500, 128MB ram, and TNT2. Fine if you like pulling teath. That's more of a Win98 / Win2k box if you ask me. XP would have to be stripped and very lean to get anything done on a box like that. I have someone who wants his computer to go faster that has maybe a 1.2GHz. Celeron, 128MB of ram, and integrated video, and I just looked and shuttered.


RE: N280 clocks
By StevoLincolnite on 2/21/2009 9:11:05 AM , Rating: 2
Windows XP was released in the era of when OC's were dominated by the Pentium 3 and the competing Athlon at the time, The Pentium 4 was yet to gain traction.

The Operating system is still pretty light and efficient even after all these years, however you add on service packs 2 and 3 and the OS gets a little more demanding on lower-end machines.

Then you forgot to factor in other things... Software was simpler back then, Photoshop was smaller and more efficient, Browsers consumed less memory, Even Office was more efficient and used a smaller base install size.

The minimum specifications for XP is a 300mhz processor and 64mb of ram.

My Granny's old system was a Pentium 3 Katmai @ 500mhz with 512kb of cache, 368mb of SDRAM @ 133mhz and a Geforce 4 MX440, Office XP, Web Browsing, and playing Popcap and Gamehouse games are perfectly fine with out any massive amounts of "Loading". - I think people over-estimate the systems they require, or load it up with that much crap it's not funny so that memory usage is massive even upon first boot.

I ended up-grading it to an Athlon XP 2000+, 1.5gb of DDR400 memory, and a Radeon x800GTO so I could play games like Unreal Tournament 2004, Quake 3, Half Life 2, Doom 3, Spore and Oblivion, the tasks she uses it for... well there is hardly a difference, she can still type as fast as she ever has, and programs don't load any faster either because of the antiquated 40gb HDD.

Virus scanners are the biggest killer, Once a week I do a manual scan for her so it doesn't waste resources.

RE: N280 clocks
By StevoLincolnite on 2/21/2009 9:12:17 AM , Rating: 2
Windows XP was released in the era of when OC's were dominated by the Pentium 3 and

Supposed to be "PC's".

RE: N280 clocks
By thegrimreaper3 on 2/23/2009 2:48:42 AM , Rating: 1
Your comment got pretty lame towards the end.

RE: N280 clocks
By Ichinisan on 2/23/2009 6:23:34 PM , Rating: 2
Why have PC133 with a Katmai? It's 100MHz FSB.

RE: N280 clocks
By Fleeb on 2/23/2009 9:14:27 AM , Rating: 2
Got my XP when I still have my IBM OEM PC (forgot which model) - Pentium III 333Mhz, 96MB SDRAM, 12GB HDD (yes, I was proud of it). Of course, I only had Office 97, Winamp, and Netscape to worry about that time.

RE: N280 clocks
By noirsoft on 2/21/2009 5:30:09 PM , Rating: 2
Vista on one is a mistake

Not true, as I've posted below.

RE: N280 clocks
By OBLAMA2009 on 2/23/2009 10:53:05 PM , Rating: 2
i use puppy linux and it runs really well in just about anything with more than 256 mb and it has everything the average user could want.

RE: N280 clocks
By noirsoft on 2/21/2009 11:15:57 AM , Rating: 3
I feel like a broken record.

With the latest Intel video drivers, you can run Vista + aero on the AspireONE. I recommend upping the RAM to 1.5 gigs, but it runs just fine.

There is no reason _not_ to run Vista on a netbook with a 100+ gig drive. The Vista install itself takes up less than 15 gigs.

Now, 7 is smaller. The 7 beta on my full laptop takes up less than 10 gigs.

I've said it before, and I will keep saying it. The reason people think that you can't run Vista on a netbook is that manufacturer's don't put Vista on netbooks. The reason for this? The perception that Netbooks can't run Vista. It's a vicious cycle.

RE: N280 clocks
By OBLAMA2009 on 2/23/2009 10:37:00 PM , Rating: 2
i doubt that netbooks cannibalize regular laptops. the arent that much cheaper and when you factor in the things they dont come with (big screen, faster chip, memory, dvd, big hard drive) they are probably more expensive and more profitable than regular laptops. intel just doesnt want the 99 percent of people that just websurf to realize that they dont need anything more

RE: N280 clocks
By MikeMurphy on 2/20/2009 3:31:26 PM , Rating: 2
Actually if they used a multiplier of 12.5 on the 533mhz bus it would result in a 1,665mhz clock.

I suspect the bus speed of 533 may have been to save power.

RE: N280 clocks
By StevoLincolnite on 2/20/2009 10:39:43 PM , Rating: 2
It's also why we never saw a 666mhz Pentium 3, the Frontside bus ran at something like 133.4mhz with a Multiplier of 5 and Intel decided to round it all off.

RE: N280 clocks
By nothingtoseehere on 2/21/2009 11:45:16 PM , Rating: 2
Because some people would think it would be evil to release a 666 MHz chip?

Every time that picture is used...
By DanoruX on 2/20/2009 1:53:35 PM , Rating: 5 should come with a link to a full resolution version.

RE: Every time that picture is used...
By Lord 666 on 2/20/09, Rating: 0
RE: Every time that picture is used...
By nwrigley on 2/20/09, Rating: 0
RE: Every time that picture is used...
By 9nails on 2/20/2009 7:59:53 PM , Rating: 2
Oh, Firefly's Saffron?! I never had a name to the face. Hells yeah then! +1

By Lord 666 on 2/20/2009 8:19:54 PM , Rating: 2
Don't forget "Mad Men."

Women should have curves. The girl in the HP pic is flat as those netbooks.

RE: Every time that picture is used...
By acx on 2/20/2009 3:49:09 PM , Rating: 5
XP could be a factor
By Belard on 2/20/2009 4:53:48 PM , Rating: 3
With some low-end notebooks costing about $500 for 14~15" models that include vista and 1GB of RAM...

The netbooks are the ONLY mainstream computer you can buy anywhere that has WindowsXP installed. $350 (avg) gets you a 512mb/1GB netbook.

I have a full size ThinkPad, but the tiny IdeaPad for $350 with XP is very attractive... compared to their top-end 12" $2000+ X300 or X62.

RE: XP could be a factor
By inperfectdarkness on 2/20/2009 6:59:16 PM , Rating: 2
"notebook sales being cannibalized".

this is only because notebooks are insanely overpriced. don't believe me? go "virtua-build" a notebook with the specs you'd find in a gateway p-7801u. it'll cost you >$2000.

notebooks are slipping because people don't want to pay $$$ for overpriced goods. you want a 2nd 9800m gtx card for your laptop? that'll be $697 dollars extra! (i'm not even making this up).

i can only hope that netbook sales will help drive DOWN the cost of owning your average laptop--and not cause the laptop market to whither. it's bad enough that they've started offering LOWER resolution screens on laptops--because too many idiots complained about being unable to "read" on them. (as if font size isn't adjustable...)

i may speak for a vast MINORITY when i say this...but give me a cheaper laptop, with MORE power--even if it has to be a bit thicker.

RE: XP could be a factor
By GaryJohnson on 2/21/2009 4:13:18 AM , Rating: 2
The desktop replacement market I don't think will see much impact on sales or prices by netbooks as they are at such extreme opposites in the 'spectrum' of portable computing.

What's really needed there to drive down prics is a good enthusiast solution. I think a really slick suitcase-case with a micro-atx case, PSU, battery, & keyboard in one half and a VESA mount & speakers in the other would fit the bill, but noone is marketing one yet.

RE: XP could be a factor
By inperfectdarkness on 2/22/2009 5:40:28 PM , Rating: 2
offer me a 15.4" with a WUXGA screen, 4gb ddr3, & geforce 9800m gtx. charge $1500 for it.

offer me a 17" with WQXGA screen, 4gb ddr3, and geforce 9800m gtx sli. charge me $2500 for it.

the market is or not the stupid manufacturers will wise up.

By Dreifort on 2/20/09, Rating: 0
RE: cartoon
By LRonaldHubbs on 2/20/2009 2:36:49 PM , Rating: 5
Though it wouldn't be as funny as the original cartoon, it would share a common thread of not being even slightly racist.

Also, Al Sharpton is a f***ing moron and one of the worst racists alive today.

RE: cartoon
By MPE on 2/20/2009 3:27:24 PM , Rating: 2
No it would not. But just like the original NYP cartoon - it would not be funny or show any hint of actual insight.

The most offensive part about that cartoon is the Post thinks it is actually good and paid him. Have you seen his other crap?????? And I get Post delivered at home.

RE: cartoon
By mindless1 on 2/20/2009 4:35:13 PM , Rating: 1
Since a cannibal isn't a race, no, but a cannibal seeing it would tend to be similarly offended.

By Danger D on 2/20/2009 3:17:01 PM , Rating: 2
IDC forecasts that netbook sales in 2008 are going to be about 10 million units. The overall notebook market is expected to ship 142 million units meaning that netbook shipments are only 10% of overall notebook shipments.

10 million isn't 10 percent of 142 million.

RE: math
By Oregonian2 on 2/20/2009 4:30:56 PM , Rating: 2
It is, to the nearest 10% increment.

RE: math
By Shadowself on 2/21/2009 8:31:29 PM , Rating: 2
DC forecasts that netbook sales in 2008 are going to be about 10 million units. The overall notebook market is expected to ship 142 million units meaning that netbook shipments are only 10% of overall notebook shipments.

This may be the worst paragraph ever written on this site. First, how can any numbers given for shipments made in 2008 be a "forecast"? Second, 10 out of 142 is no where near 10%. It's 7%.

RE: math
By whirabomber on 2/23/2009 8:37:05 AM , Rating: 2
One megabyte isn't 1,000,000 bytes nor is a gigabyte 1,000,000,000 bytes, but it is to HD and computer manufacturers.

If you want to sell something then 10% is good industry math, if you want to discontinue a line, then it is <7%. I love computer industry math - it is the same math politicians use.

By supergarr on 2/20/2009 8:45:52 PM , Rating: 2
i always thought netbooks were a fad. I have big hands and can't even imagine typing on one of those things.

RE: fad?
By afkrotch on 2/23/2009 11:02:57 AM , Rating: 2
For those with big hands, just jam the netbook in your pants to keep warm. 2009 models will be getting lotion dispensers and a vibrate function. 2010 gets a tissue dispenser.

Smaller Computer Makers Like Acer?
By Wieland on 2/20/2009 2:50:31 PM , Rating: 2

Worldwide Acer has a significantly larger share of the notebook market than Dell.

"Paying an extra $500 for a computer in this environment -- same piece of hardware -- paying $500 more to get a logo on it? I think that's a more challenging proposition for the average person than it used to be." -- Steve Ballmer

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