As 2008 comes to a close, it’s time to review past trends and consider what’s around the corner. Arguably, the hot product of the year is one that didn’t even exist until October 2007: the lowly netbook. In 2008 alone, the top two netbook vendors are […]

As 2008 comes to a close, it’s time to review past trends and consider what’s around the corner. Arguably, the hot product of the year is one that didn’t even exist until October 2007: the lowly netbook. In 2008 alone, the top two netbook vendors are forecasting 11 million devices sold; Asus anticipates selling 5 million, while Acer expects to move 6 million. First-year sales figures like this, combined with today’s news that Apple sales are down 1 percent while PCs have seen a 2 percent sales gain, are resurrecting the debate. Will Apple release a netbook-type device in 2009?

TBR Strategy is among those expecting to hear a netbook or comparable device announcement at MacWorld next month, with a product release around mid-year:

This device, which will be a closed system similar to the iPhone as opposed to a less-expensive Mac, will leverage Apple’s unique strengths in design, software and online delivery systems, challenge netbooks and fit the needs of a recessionary market. By controlling the software that can be loaded and the hardware that can be attached, Apple’s device will be simpler, easier to use and more reliable than a PC, and will excel at the functions most required by users.

TBR believes that Apple will announce the new product at MacWorld in January 2009, to become available around mid-year. It will come in two sizes, one much like the MacBook Air and one similar to a netbook, with the smaller unit priced at $599.

Like many other Apple astrologists, TBR isn’t applying the standard netbook definition to a potential Apple device in this market. Perhaps we shouldn’t either since Apple usually marches to the beat of its own drum and many consumers believe the iPhone and iPod Touch already compete with traditional netbooks. It’s not difficult to imagine Apple refining the netbook concept by leveraging a touch-enabled device similar to a large iPhone or iPod Touch. With a stylish stand and portable Bluetooth keyboard, undoubtedly Apple-branded of course, such a device could be seen as “the netbook evolved.”

On the other hand, our friends at The Apple Blog think that Apple wants no part of the netbook market:

While it’s possible to imagine someone thinking a netbook is “as good” as a cheap laptop, I don’t imagine any user thinking the same when comparing a netbook and a low-end white MacBook. No way. They’re worlds apart. I believe any user allegedly buying a netbook instead of a MacBook was never getting the Mac anyway. Apple knows this. If they get in this game, it will be with a complete product — more expensive than most netbooks — from which they’ll make a reasonable profit and not have to hope for up-selling.

Given recent netbook price cuts, I’m sure there isn’t much profit margin for Apple down here. It would also further dilute Cupertino’s computing product line and could even cannibalize sales away from the higher priced (read: more profitable) MacBook and MacBook Pro lines. Of course, that implies that an Apple netbook isn’t a companion device, which is generally how most PC netbooks are marketed.

Unfortunately, the global economic slowdown and higher product line pricing are surely contributing to lower Apple sales, so perhaps Apple is ripe for a netbook competitor. Back in October I felt that Apple would need to re-align the MacBook products to make room for just such a device. I also figured that if HP could fit an Nvidia GPU in a 13-inch PC, Apple should be able to follow suit.  Sure enough, the company took both actions a few weeks later by introducing the new aluminum MacBook; essentially a “MacBook Pro Jr.” All that’s left now is to announce the new product that they’ve made room for.

Do you think that product is a netbook competitor or is the netbook craze simply a low-cost fad that will fade away when the economy strengthens? Chime in on our netbook poll, and share your thoughts in the comments.

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By Kevin C. Tofel

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  1. I think NetBooks are a fad technology sitting in the dead spot between iPhone and laptops. I don’t understand the use case they are going for here… nerdy IT guy? The problem with a NetBook is that for extended use an AC adapter is needed, and once you add that bulk to make it through a day, a 13″ notebook makes more sense. Not since the HP 200LX (circa 1994) have we seen a really useful device in this middle ground — and it ran for 40+ hours on two AA batteries.

  2. In a world where a $350 netbook has more power than 90% of people need in a portable computer, it’s crazy that Apple’s entry-level notebook is $900.

    I hope, for their sake, that Apple’s working on a nice $500 netbook.

  3. Not sure what Apple is specifically up to and, if I were, I surely wouldn’t be allowed to share. However, I can say that the Dell Mini netbook that I bought has served only one useful purpose .. it inspired me to finally cough up the money for a 3G device and plan which I now use mostly with my Lenovo X61, not the Dell. Turns out that I usually need more of “my stuff” than I had anticipated when I decided to buy the Dell.

    Here’s where the math breaks down for me though…. the netbook isn’t *that* much smaller and lighter than the X61. At the same time, the cost of 3G for year, by definition, puts me in a spending category where I don’t have to settle for a netbook. Remember a few years ago we were all debating how MS could keep charging that much for Windows when the price of laptops was approaching the price of the OS? Well the cost of connectivity now eclipses both. A netbook with no connectivity is a smaller, harder to use flavor of today’s least expensive standard notebooks. And, a netbook with good connectivity costs enough that the buyer can afford a decent small, light notebook and probably already owns one.

    Leaves me feeling that the netbook is a fad with a cute or “look what I have now” factor but that is doomed to be a transition device stuck between light notebooks and smartphones. Ultimately notebooks only need to get 20% less expensive than they are today, gain better battery life and good built-in 3G or 4G with VOIP then we’ll end up carrying just the notebook with instant on for cellular or VOIP calling and leave the cellphones, netbooks, ipods and more at home. Or, we’ll have a smart phone that does almost everything and just carry the notebook for real computer chores. Seems like a variation on this thinking drove Palm to aim for the Foleo but they failed to “get” that we wanted fewer, not more things to carry and couldn’t bring themselves to obsolete the Palm device that the Foleo would interface with. Innovator’s Dilemma?

  4. I wouldn’t characterize netbooks as a fad – excepting those purchased primarily as a price-driven laptop. Scott has it right on for what follows.

    I do think the small form factor is a legitimate niche – and the price drives the market for something cheaper than the Fujitsus, etc. which used to be the only thing available. Just as there is a niche for Tablets.

    3G built-in? Makes sense. But, everything else you really need to have with you throughout the day is what should make the decision.

  5. “3g Macbook” is what they should call it.

  6. The short-term reason Apple will announce a netbook is not to turn around its’ sales curve but to appease the stockholders. The long-term reason is that the MacBook Mini will fulfill the role that the Mac Mini was supposed to play but failed miserably at: to give a Mac taste to users who shy away from Apple’s computer products because they’re too expensive.

    If anyone cares, my full diatribe is here: http://www.netbookera.com/why-exactly-apple-will-announce-a-macbook-mini-netbook-this-january-2009/

  7. Digital Technology Blog » Blog Archive » Iphone… nano? Tuesday, December 16, 2008

    [...] Apple’s Debatable Need for a Netbook [...]

  8. From a form factor perspective, a large, intermediate sized tablet makes a lot of sense. But when people say netbook/MID, they generally imply a certain price range also, which I believe Apple wants no part of. If such a device is on the roadmap, it’ll be priced up for its portability but certainly not priced down for its lack of computational muscle.

  9. I’m finding that for meetings and travel a netbook is much more convenient than a full laptop these days. No wonder they are now outselling the iPhone as a group.

    An Apple Netbook would make sense. It would fill out their product line.

    On the other hand, it’s pretty easy to install the Retail Edition of Leopard on an existing Windows Netbook like the MSI Wind and have an excellent netbook that dual boots both Windows (XP or Windows 7) and Mac OSX. So netbook fans already can get the level of functionality discussed here, regardless of what Apple may – or may not do at Mac World in January!

  10. I don’t believe Netbooks are a fad… but rather, they have still yet to evolve to their full potential – which is where apple could certainly capitalize.

    If you look at the buyer demographics for these devices, they are greatly driven by younger, smarter, web 2.0 and social networking junkies. These kids will grow up “in the cloud”… and I think that is the most important issue that isn’t being properly assessed by the critics.

    Think Apple…. Think Netbook…. Think App Store…. Think $$$.

    To their [Netbooks] credit, its not so much that they are at fault for being considered a “Fad” at the moment…. It’s simply that the infrastructure they were meant to Thrive On – WiMax/4G, Cloud Computing, Hosted/Subscription Everything – has yet to have been fully realized.

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