Netbook sales are about sixteen percent of all laptop sales in the world, but that number is even higher in western Europe. According to European sales chief Christian Morales, the "cannibalization" of portable PC sales has been less than projected, but in Britain and Italy the levels are as much as a quarter of these sales. The market for inexpensive netbooks is growing faster than conventional notebooks. The limited function laptops save the consumer cash by doing away with optical drives, heavy duty processors and other features, while promising maximum portability and absurdly long battery life - products similar to the ASUS Eee PC 1000HE, a netbook with a ten inch screen and claimed 9.5 hours between charges, which retails for under four hundred dollars.
The Intel Atom processor has established itself as one of the top performers in these devices that are designed for Web browsing, office applications and other light-capacity tasks. Because of the lower price, fear surrounds the possibility that fewer standard laptops sold will result in lower earnings.
But the limited capacity of these machines definitively safeguards against this from happening. Netbooks are not the product of choice for most computer users - streaming high-definition video leads to dropped frames and skipping audio, and video editing is impossible. Most netbooks are secondary travel computers, or used by people with very little CPU-power need. Essentially, this can only add to the units sold, not subtract.
Still, Morales' numbers indicate that twenty percent of netbooks sold would otherwise have been sales of fully-powered notebooks, according to Reuters today. The cheaper Intel processor Celeron, used to run low-end regular laptops, has also experienced cannibalization by the Atom. But the Atom profit margins are higher than the older Celeron processors.
Intel is looking to notebooks to power growth in the recession years, fueled by trends favoring mobility.