Stop Eulogizing the Netbook

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New sales figures show that shipments of Atom chips, which power netbooks, slumped 33% last quarter, leading some to say the heyday of netbooks is over. But pronouncements about the death of the netbook are premature. Here's why.

IDC reports that Atom shipments slumped 33% in the first quarter of 2009 compared to the final quarter of 2009. That's certainly worrisome. But it's not as bad as you might think. First of all, shipments almost always slump between the last quarter of one year and the first quarter of the next, after the holiday season ends. IDC notes this about the decline of all chips in the first quarter of 2009, not just Atom chips:

"While the decline was slightly more than typically occurs between fourth quarter and first quarter, IDC believes that the market's decline is slowing."

Other factors are at work as well. There's a new generation of Atom chips on the way, and so some consumers may be waiting until netbooks arrive with those chips in them, which might have helped kill demand. And Intel competitors are coming out with netbook chips as well, notably to build ARM-based machines.

The upshot? Netbooks will continue to sell, and you can expect to see far more variety among them. Even the least expensive of them, at under $300, will get a bit more power. And the more expensive ones will begin to add larger screens, better keyboards, and touch screens.

That 33% drop is likely a temporary blip. Netbooks are here to stay.

This story, "Stop Eulogizing the Netbook" was originally published by Computerworld.

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