Revenue from computer sales is down by 20 percent despite a 1 percent increase in shipments. This is because netbooks are cannibalizing sales of desktops and notebooks alike.
It is odd, to me, that people can use these things as “main machines” — I, for one, cannot. The fact remains that people are making do, however, and it’s like a wrecking ball going through the industry’s profit margins. From Gartner:
The growth driver for the 2008 holiday PC season was the mini-notebook segment. With more vendors offering creative sales promotions, the mini-notebook segment outpaced overall mobile PC growth. However, PC revenue experienced a record decline. Steep average selling price (ASP) declines, as well as robust growth of low-priced systems, including mini-notebooks, contributed to this drop.
This is why certain branches of Intel are getting antsy about the segment: it likes selling Atoms, but it likes selling Core 2 Duos much, much more.
“Mini-notebook,” by the way, is the new phrase analysts and Intel competitors are using to avoid “netbook,” which is loaded with Intel Atom associations and an unresolved trademark issue with Psion.