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Will tablets kill netbook market?

Posted: 09 Jul 2010     Print Version  Bookmark and Share

Keywords:tablet PC  netbook  notebook  x86  processor 

Barclays Capital says the success of tablet PC is not only shaking up notebook and netbook sales but shifting some business from x86 chips and Windows to ARM-based processors and Google Android.

Barclays issued a set of reports that run down the implications for the mobile supply chain of the rise of tablets in the wake of the success of the Apple iPad. If the predictions are accurate, the new mobile form factor could be the first to drive a measurable shift towards alternative architectures, chipping away at the long dominant Windows-Intel duopoly in computing.

Analysts at the Wall Street firm project sales of 1.5 crore media tablets this year, rising to 2.8 crore in 2011, 70 per cent of them for the ARM-based Apple iPad. Barclays estimates 30 to 40 per cent of the tablet purchases will be made instead of purchases of netbooks and notebooks, just as the netbook cannibalized a similar percentage of notebook sales.

Thus Barclays is reducing its forecast for netbooks from 19 per cent unit growth in 2010 to nine per cent growth and sales of 3.5 crore units. It expects netbook sales will actually decline 20 per cent in 2011 to sales of 2.8 crore units.

Barclays is also shaving four per cent off its forecast of notebook computer sales. It now expects 34 per cent notebook growth in 2010 to 18.3 crore units and 25 per cent growth in 2011 to 22.9 crore units.

Although the analyst firm sees no change in desktop and server sales, the tablet shift results in a lowered overall PC forecast from 21 to 19 per cent growth in 2010. Notebooks are the fastest growing segment of the PC industry.

Chip winners, losers
The rise of tablets will give a boost to ARM and a host of associated chipmakers, while Intel and AMD will take a minor hit, according to Barclays.

"The primary change comes in our Atom-based netbook forecast which slips from 20 per cent growth at 44 million units [4.4 crore] to 40 million [four crore] units in 2010 and from 21 per cent growth at 53 million [5.3 crore] units to around 10 per cent growth or 44 million [4.4 crore] units for 2011," a Barclays report said.

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