ImagingInfo.com |

Online Article Page

  

News
Smaller PCs Cause Worry for Industry
source: New York Times


The HP 2133 Mini-Note PC
source: New York Times



SAN FRANCISCO -- The personal computer industry is poised to sell tens of millions of small, energy-efficient Internet-centric devices. Curiously, some of the biggest companies in the business consider this bad news.

In a tale of sales success breeding resentment, computer companies are wary of the new breed of computers because their low price could threaten PC makers' already thin profit margins.

The new computers, often called netbooks, have scant onboard memory. They use energy-sipping computer chips. They are intended largely for surfing Web sites and checking e-mail. The price is small too, with some selling for as little as $300.

The companies that pioneered the category were small too, like Asus and Everex, both of Taiwan.

Despite their wariness of these slim machines, Dell and Acer, two of the biggest PC manufacturers, are not about to let the upstarts have this market to themselves. Hewlett-Packard, the world's biggest PC maker, recently sidled into the market with a hybrid of a notebook and netbook that it calls the Mini-Note.

Several makers are taking the low-powered PCs one step further. In the coming months, they are expected to introduce "net-tops," low-cost versions of desktop computers intended for Internet access.

A Silicon Valley start-up called CherryPal says it will challenge the idea that big onboard power is required to allow basic computing functions in the Internet age. On Monday it plans to introduce a $300 desktop PC that is the size of a paperback and uses two watts of power compared with the 100 watts of some desktops.

It wants to take advantage of the trend toward "cloud computing," in which data is managed and stored in distant servers, not on the actual machine.

Industry analysts say that the emergence of this new class of low-cost, cloud-centric machines could threaten titans like Microsoft and Intel, or even H.P. and Dell, because the giants have built their companies on the notion that consumers want more power and functions built into their next computer.

Some of the big computer companies put a positive spin on the low-cost machines, saying they welcome new categories. But they would just as soon this niche did not take off, given the relatively low profit margins.

"When I talk to PC vendors, the No. 1 question I get is, how do I compete with these netbooks when what we really want to do is sell PCs that cost a lot more money?" said J. P. Gownder, an analyst with Forrester Research.

Even as some PC vendors are jumping into the fray, others say they are resisting. Fujitsu, one of the world's top 10 personal computer makers, said that it believes the low-cost netbook trend is a dangerous one for the bottom line.

"We're sitting on the sidelines not because we're lazy. We're sitting on the sidelines because even if this category takes off, and we get our piece of the pie, it doesn't add up," said Paul Moore, senior director of mobile product management for Fujitsu. "It's a product that essentially has no margin."

Stan Glasgow, chief executive of Sony Electronics, said, "We are not looking at competing with Asus." But he said the company is investigating what consumers want in a second PC.

1 2 next

   







PTN Dailes HERE